Worldcoin: Eye-scanning cryptocurrency launches with $1 billion valuation

    25 Oct 2021

    OpenAI CEO and former Y Combinator President Sam Altman has announced Worldcoin, a project designed to equitably distribute free cryptocurrency to as many people as possible. Obtaining that crypto, however, involves a discomforting concession – an iris scan, which has raised privacy concerns amongst critics.

    According to Global Findex, over 31% of the global population is unbanked. It means that billions of people don’t have access to traditional financial services, have also never used cryptocurrency for simple transactions, such as payment of goods and services.

    In an effort to put cryptocurrency in the hands of more users, Worldcoin has launched a plan to distribute their cryptocurrency to all, with an emphasis on new users in developing markets.

    In Worldcoin design, each future user has been pre-allocated their share of the coin’s supply. Employing a unique distribution strategy, the company has built an Orb, a hardware biometric device that uses unique identification techniques to identify users, help people set up their wallets, and receive their allocation of the digital currency.

    The team plans to identify Orb operators around the globe to operate the device and reward successful signups. These operators organize in town squares, transit hubs, and public rights of way to enroll people and deposit the coin into a wallet application on their phone.

    The new cryptocurrency project is led by Alex Blania, a former researcher at the Max Planck Institute for the Science of Light and Caltech. He joined Sam Altman, the founder and CEO of OpenAI and a previous President at Y-Combinator, which has invested in multiple unicorns, including Coinbase, Airbnb, Dropbox, Stripe, and DoorDash.

    “Worldcoin is solving one of the internet’s fundamental problems at scale – ‘proof of personhood.’ The Orb allows Worldcoin to build a very powerful application – potentially the most widely distributed cryptocurrency network in the world,” Chris Dixon, General Partner at Andreessen Horowitz, told Forbes. “Once it reaches critical mass, other projects and entrepreneurs will be able to use this as a platform to build the future of the internet as we know it. We are thrilled to partner with Alex, Sam, and the Worldcoin team on this important journey.”

    The Worldcoin team has already signed up over 100,000 people worldwide for the digital currency under these ‘stealth’ conditions, aiming to enroll a billion people in their first two years of the public launch. During this stealth testing period, each operator has been able to enroll an average of 700 people per Orb per week by increasing the number of devices and broadening the number of countries they serve, which at scale will lead to over 1 billion people enrolled in the first two years.

    “The more participants a network like this has, the more powerful it becomes for its users,” Blania says. “Giving billions of people access to one commonly owned network will lead to a major acceleration of the whole crypto space. Entrepreneurs all over the world will start building cryptocurrency applications that are barely imaginable today.”

    When the idea was first floated this summer, privacy experts and cryptocurrency advocates voiced numerous warnings about the scheme. Experts raised concerns over the possibility of things like biometric data being hacked or stolen, and one privacy attorney went so far as to tell Recode that “this company and this currency should simply not exist.”

    Although some may sense dystopian underpinnings to this aspect of the Worldcoin project, the team maintains that privacy is inherent in the design of their Orb, and that they have used cutting-edge technology and cryptographic techniques to address these concerns. The Worldcoin team claims that they need not store the original image nor capture any other personal information. Furthermore, one need not scan their eyes to join the Worldcoin network, as biometrics are only necessary to claim a free share.

    Worldcoin currently values itself at a ‘unicorn’ valuation of $1 billion. The company has raised $25 million from top Silicon Valley technology and crypto investors over the last few months, including Andreessen Horowitz, Coinbase Ventures, Blockchange, Fifty Years, Day One Ventures, CoinFund, 1confirmation, and angels including Reid Hoffman (Founder of LinkedIn), Sam Bankman-Fried (founder of FTX), as well as the founders of Solana and Polkadot.

    Leave a Reply

    Your email address will not be published. Required fields are marked *