“Worldcoin” the latest project in the cryptocurrency world, has been introduced by AI developers to address challenges related to identity verification and fraudulent bots.
Worldcoin (WLD), the latest cryptocurrency project, has significantly impacted the financial and tech worlds with its ambitious and unique approach to achieving global scale. Introduced by leading AI developers, this project aims to solve major issues in the cryptocurrency industry, including identity verification, scam bots, and artificial intelligence (AI) concerns.
What is Worldcoin?
Worldcoin’s mission is to create the largest global identity and financial network as a public utility, granting ownership to everyone. The project merges blockchain technology with digital identity, aiming to distribute a new cryptocurrency globally to anyone with internet access. Worldcoin has already garnered significant global attention with these ideas.
The Worldcoin ecosystem revolves around the “World ID“, a global identity network with privacy-preserving capabilities. This worldwide network allows users to verify “proof of personhood” online while maintaining privacy through zero-knowledge-proof technology.
To interact with the Worldcoin protocol, individuals must first download the World App. This app includes a wallet that enables users to use and support their World ID, marking a first-of-its-kind innovation. Users obtain their unique World ID through a physical imaging device called the “Orb,” which verifies their global identity.
The Orb device is a unique hardware piece resembling a basketball-sized orb. It can scan users’ eyes and generate a unique biometric identity. The use of biometric identifiers dates back centuries—fingerprints, for example, have long been used to confirm identities. However, creating digital biometric identifiers to distinguish between human identities is a modern concept that has become increasingly important with the rise of AI and robots.
Orb devices, often operated by independent local businesses called Orb Operators, use multispectral sensors to verify humanity and uniqueness, creating a global user ID. Once the unique ID is made, all images are promptly deleted by default to ensure users’ satisfaction regarding their identity data protection. The Worldcoin protocol uses this ID to ensure fair token distribution among users, a novel approach to validating authenticity and preventing fraud, ensuring equitable ownership distribution of assets.
Worldcoin’s Vision According to Its Developers
This project was founded and developed by Sam Altman, Alex Blania, and Max Novendstern. Sam Altman, the most well-known co-founder of Worldcoin, is also a co-founder and the current CEO of OpenAI. He previously served as the president of Y Combinator, a startup incubator that supports new businesses.
To date, the project has raised over $250 million in funding from several rounds of investment, backed by venture capitalists such as a16z, Khosla Ventures, Bain Capital Crypto, Blockchain Capital, Tiger Global, and others.
The core team behind Worldcoin has set an ambitious vision for its future. According to the project’s whitepaper, Worldcoin is designed to be an inclusive cryptocurrency that gives everyone on the planet the opportunity to participate in the global economy, regardless of geographical location. The project promises to push and develop the boundaries of blockchain technology to ensure a fairer financial landscape. This is significant, especially given that, at the advent of ChatGPT, some saw AI systems as a threat to the world of cryptocurrencies.
According to some experts, Worldcoin is designed with user governance in mind. The project aims to go beyond the conventional “one token, one vote” governance mechanism. Specifically, by introducing a global identity system and online identity verification, Worldcoin is paving the way for a better “one person, one vote” governance model. Moreover, these two mechanisms can be combined to enable new, fairer governance pathways.
According to Reuters, Orb devices are currently active in 35 cities across 20 countries. The project has also recently launched its software development kit (SDK), allowing developers to build applications using their digital identities. However, Worldcoin is not yet available in the U.S. due to regulatory restrictions.
What Does the Crypto World Think About Worldcoin?
Opinions about Worldcoin’s unique approach vary. Vitalik Buterin, the creator of Ethereum, recently shared his thoughts on the biometric system used in this project in a blog post. He pointed out several potential risks of using a large-scale biometric-based system, including privacy concerns and the possibility of irreversible damage if biometric data is compromised. Buterin emphasized how difficult it is to replace biometric data after it has been exposed, unlike passwords or private keys.
While biometric technology has significant advantages in preventing fraud and misuse in cryptocurrency distribution, Buterin argues that due to the sensitive nature of the data, the use of such security systems should be held to high ethical standards and carefully monitored. He also believes that collecting such data could present challenges when it comes to obtaining user consent.
On the other hand, Buterin acknowledges the necessity of such tools and explains why we need proof of personhood (PoP). He believes these tools enable decentralized systems like Ethereum to distinguish between real humans and bots. This distinction is becoming increasingly important in a world where more interactions occur online. This technology could make projects more secure against scammers or malicious bots trying to manipulate digital systems.
Therefore, Buterin emphasizes giving each user a unique digital identity through PoP mechanisms to combat such manipulation. By verifying that each account belongs to a real person, PoP can be a powerful tool for ensuring fair distribution of resources and modern governance. With this mechanism, users can create systems that prevent corporations and centralized entities from dominating digital services. However, this approach is not without risks.
What Are the Risks and Challenges of Worldcoin?
As mentioned earlier, Buterin highlighted several risks with the Worldcoin project. One of the concerns lies in the Orb devices. If these devices are hacked in a decentralized production system, a manufacturer could create millions of fake scans, compromising the integrity of the entire system.
Another concern is the potential misuse of verified identities. Buterin warned about scenarios where individuals might sell or rent their identities, leading to a corrupt system. Worldcoin distributes cryptocurrency based on a person’s identity, meaning each person gets a share. Selling or renting out one’s identity would undermine the system and could create a black market for renting global identities.
Buterin also discussed the need for a proper management mechanism for lost or forgotten global IDs in such protocols. He mentioned that if someone loses access to their Worldcoin identity, there must be a secure and reliable mechanism for recovering it. Without a sound plan for this, losing a user’s ID could result in financial loss and potential misuse of that person’s identity.
To address these issues, Buterin suggested several blockchain-based options. One of his proposed solutions involves using systems based on “personhood oracles.” Buterin also believes that a system where multiple validators agree on a person’s uniqueness could help reduce the risk of system abuse. Although these solutions have drawbacks, some experts argue that they don’t have the same privacy concerns as Worldcoin’s biometric system. For this reason, Buterin believes that his solutions might ultimately surpass the biometric approach.
