Worldcoin came into Kenya disguised as a research project, Parliament told

National Assembly Communication, Information, and Innovation committee deliberates on the WorldCoin data saga at County Hall, Nairobi. [Elvis Ogina, Standard]

The National Assembly Ad Committee of Inquiry into the Worldcoin operations has heard that the crypto wallet app came into Kenya disguised as a research project.

Presenting its views amid investigations into the controversial Worldcoin operations in Kenya, the National Computer and Cybercrimes Coordination Committee (NCCCC) told the parliamentary committee that Worldcoin registered as a data controller in Kenya, allowing the company to determine how to use the collected data in the country.

"We have noted obvious breaches of our data protection laws," the committee noted, adding that Kenya cannot compel them [Worldcoin] to comply with the country's regulatory laws as it lacks jurisdiction, considering it does not have physical offices here.

On its impact to the economy, NCCC Director James Kimuyu said that cryptocurrency could cause implications on the monetary policy and control of the country.

"Cryptocurrencies and blockchains could challenge the central bank's ability to control the money supply and implement monetary policy. The decentralized nature of cryptocurrencies could impact interest rates and reserve requirements," Kimuyu noted.

The committee further stated that the Worldcoin transactions could lead to tax evasion since it can be difficult to track and tax due to their decentralised nature.

He added that it could also pose competition to foreign exchange systems and remittance providers owing to its speedy and co-effective transaction.

The committee has also said that the use of biometric data by the data collecting company could pose a threat to national security.

"The financial and digital identity platform has inherent cybersecurity risks and vulnerabilities including cyber-attacks, hardware security, computer fraud, data breaches, and identity spoofing, exploitation amongst others," he added.

Kimuyu highlighted that Worldcoin activities could lead to rising cases of terrorism and criminal activities like money laundering and cyber security threats.

However, the committee also noted that when used well, the blockchain could offer more secure methods of verifying identity and ownership hence reducing cases of identity theft and fraud.

NCCC further recommended that the Worldcoin data collection drive remain suspended in the country until investigations are concluded.

It has further called on the Ministry of Interior and National Administration to demand the preservation of the data that had already been collected by the company to give more time for investigation into the method that was used in the collection, transmission, and storage of the data.