China warned of the increasing use of biometric data by crypto-linked projects, cautioning that iris-scanning programs operating under the guise of digital asset distribution may threaten personal privacy and even national security.

In a public security bulletin published Wednesday, China’s Ministry of State Security (MSS) outlined several emerging risks associated with biometric recognition technologies, including facial, fingerprint and iris data collection.

The MSS cited an unidentified overseas company that, “under the guise of issuing cryptocurrency tokens, scanned and collected iris information from users worldwide and then transferred the data source.” Officials said this posed “a threat to personal information security and even national security.”

The reference appeared to point to Sam Altman’s World, known for collecting iris data in exchange for its World (WLD) token globally. According to its website, World has operated in 160 countries, though China is not one of them.

Iris data leaks are irreversible

The MSS described iris recognition as a high-precision biometric method commonly used in sensitive areas. These features also make it an attractive target for misuse. Once compromised, such biometric “keys” are nearly impossible to change.

Facial recognition was also flagged as a critical concern. “Improper storage of relevant data can lead to leaks, which not only endanger personal privacy and property security but also pose a threat to national security,” the bulletin warned.

Officials cited cases of foreign intelligence agencies falsifying facial data to conduct espionage operations, including infiltration of key workplaces.

“While biometric identification brings convenience,” the notice concluded, “we should attach great importance to its security and be cautious when providing personal biometric information.”

Vitalik proposes pluralistic digital ID to protect privacy

In June, Vitalik Buterin proposed a new concept called pluralistic identity, aimed at preserving privacy and inclusivity in digital identification. The Ethereum co-founder expressed concerns that even privacy-focused systems using zero-knowledge (ZK) proofs could pose risks if they enforce rigid, one-per-person identity models.

Buterin warned that requiring a single, trackable ID may eliminate pseudonymity and expose individuals to surveillance from governments or employers. He also dismissed “proof of wealth” as a fair verification method, arguing it favors the rich and excludes others.

As a solution, Buterin backed pluralistic identity frameworks, where verification comes from a combination of sources, such as governments, social networks or community-driven systems, without any one gaining dominance.