23andMe Bankruptcy: The Sale of DNA Data and the Rush to Delete—Could Your DNA Be Sold to the Highest Bidder?

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23andMe, a leader in DNA testing, has filed for Chapter 11 bankruptcy. This news has sparked worry about its 15 million users’ genetic data. The company plans to sell its assets, including this DNA database, to recover financially.

As users rush to delete their information, many wonder if their data is truly gone. This also raises questions about how deletions impact 23andMe’s financial strategy.

Bankruptcy and the Plan to Sell DNA Data

On March 23, 2025, 23andMe started Chapter 11 proceedings in the U.S. Bankruptcy Court for the Eastern District of Missouri. The company has struggled financially for years. Declining demand for its ancestry and health kits, a 2023 data breach affecting 7 million users, and a 40% staff layoff in November 2024 have all taken a toll.

To address this, 23andMe aims to sell its assets through a court-supervised process. This includes a 45-day bidding period, which may lead to an auction for the highest offer.

The company’s most valuable asset is its genetic database. It holds DNA profiles from over 15 million users who submitted saliva samples. This data is highly valuable to pharmaceutical companies and researchers.

23andMe secured $35 million in financing to keep operating during bankruptcy. However, selling its assets, including the genetic data, is the main way to resolve its financial troubles.

On March 24, 2025, 23andMe posted on X to reassure customers. They stated the announcement would help them become more financially stable. They also said there are no changes to how they store, manage, or protect customer data.

The company added that any buyer must follow laws about handling customer data. But this hasn’t calmed fears. A U.S. Treasury advisor claimed on March 24, 2025, that 23andMe shared data with pharmaceutical firms and even Russia’s Ministry of Defense. These unverified claims have increased public concern about data misuse.

Users Begin Deleting Their Data

The bankruptcy news has led many users to delete their genetic data from 23andMe’s systems. On March 21, 2025, California Attorney General Rob Bonta urged customers to take this step.

The Washington Post reported on March 24, 2025, that 23andMe’s website had issues that morning. This was likely due to a surge of users trying to remove their data. The situation improved by the afternoon.

On social media, users have shared their frustration. Some suggest moving genomic data to platforms where they can own and earn from it. Others worry about their health DNA being sold and wonder if lawsuits might be needed. Many feel betrayed by the company’s actions.

How Deletions Affect the Sale

Mass data deletions create a problem for 23andMe’s sale plans. The genetic database is its biggest asset. If many users delete their data, the database shrinks, making it less valuable to buyers.

A smaller database could lead to lower bids in the auction. This might hurt 23andMe’s ability to pay off its debts. Public backlash and potential lawsuits from users also scare off buyers.

Additionally, U.S. data privacy laws are weak at the federal level. This uncertainty adds risk for buyers who must deal with varying state regulations.

Is the Data Really Deleted?

Deleting data doesn’t fully erase it. 23andMe removes most identifiable information and destroys saliva samples. But some data stays behind.

The company keeps certain details, like some genetic data, birth dates, and deletion records, for legal reasons. If users allowed their data for research, it remains in ongoing or completed studies. It won’t be used in future research, though.

Data shared with third parties, like pharmaceutical companies, can’t be recalled. If claims about sharing with Russia are true, some data may already be out of 23andMe’s control.

De-identified data, without personal identifiers, may also remain. Law professor Anya Prince said on March 24, 2025, that once data is out there, it can’t be retrieved since it no longer has a name attached. A new owner could still use this data.

Looking Ahead

The 23andMe bankruptcy shows the risks of sharing genetic data with private companies. Deleting your data lowers future risks, but some may still linger and be sold.

With weak U.S. federal privacy laws, a new owner might use the data in unexpected ways, like for insurance profiling. As 23andMe moves forward, the balance between financial recovery and user privacy remains unclear. Customers are left watching what happens to their genetic information.