Regulatory entrepreneurship’s threat to digital sovereignty: the case of Worldcoin in Kenya

Abstract This article analyses the case of Worldcoin’s entry into Kenya and the controversies that ensued. The company operated in regulatory grey areas where, on the one hand, Worldcoin minimally complied with data protection regulations. On the other hand, the company collected biometric data from Kenyans, a venture that was successful because it allowed it to exchange sensitive data for cryptocurrency. Considering that Kenyans had previously contested the national biometric identification project, Huduma Namba, we analyse the case of Worldcoin in Kenya through the lens of regulatory entrepreneurship. We find that Worldcoin exploited conditions in the Kenyan regulatory environment, and was partially successful in taking advantage of legal uncertainty, using cryptocurrency as an incentive to grow fast, and engaging with the executive to lobby for its position. However, the company also encountered political, legal, and regulatory pushback that eventually led to the closing of the project. The case provides important lessons for regulators, policymakers, and other stakeholders in the governance of emerging artificial intelligence (AI). It adds to a growing list of actions by local agencies using existing laws and frameworks to assert digital sovereignty in response to emerging technology applications.