0
Applied AI·October 14, 2026·1 min read

Now that Character.AI is going bankrupt, what happens to all of its users’ data?

Share

Character.AI’s bankruptcy turning user data into a potential asset is the nightmare scenario privacy advocates warned about. If you're building consumer AI, you need a clear, contractual story on what happens to user data in a wind‑down — regulators are now watching that clause specifically.