Worldcoin

Worldcoin is a for-profit cryptocurrency project that uses iris biometrics developed by San Francisco- and Berlin-based Tools for Humanity. Founded in 2019 by OpenAI chief executive Sam Altman, Max Novendstern, and Alex Blania, it has accumulated $250 million in funding from venture capital firms Andreessen Horowitz and Khosla Ventures, as well as from Reid Hoffman.

Worldcoin hopes to provide a reliable way to authenticate humans online called World ID, and attempts to recruit new users to join its network by getting their iris scanned using Worldcoin's orb-shaped iris scanner in return for some WLD tokens. This has caused privacy concerns in multiple countries.

History

Worldcoin project was started by a company called Tools for Humanity (TFH), founded by Sam Altman, Max Novendstern and Alex Blania in 2019.

In 2021, the company stated that its token (WLD) is intended to be a larger effort to drive a more unified and equitable global economy driven by the internet economy, although it will not be available in the USA. The token will be a Layer 2 Ethereum-based cryptocurrency that leverages the security of the Ethereum blockchain while having its own economy.

In October 2021, the project raised an initial $25 million. Within six months, an additional $100 million was raised, pushing the token's value up to $3 billion.

In April 2022, a report from '' MIT Technology Review'' cited those from the community who accused Worldcoin of "taking advantage of students" and "targeting lower-income communities", and came to the conclusion that "it's just cheaper and easier to run this kind of data collection operation in places where people have little money and few legal protections."

In May 2023, TechCrunch reported that hackers had been able to steal login credentials of several of Worldcoin's operators' personal devices including their credentials to the Worldcoin operator app. However, Worldcoin's spokesperson said that no personal user data was compromised, as the operator app does not access user data.

Further funding of $115 million was announced in May 2023, to be used for investment into bot detection, research and development, and expanding the Worldcoin project and application. While in beta, Worldcoin was reported to have onboarded approximately two million users. By July 2023, they had $250 million in funding from venture capital firms Andreessen Horowitz and Khosla Ventures, as well as Reid Hoffman.

Worldcoin launched out of beta on July 24, 2023 with 11 orb locations in the U.S. and plans for 35 cities in 20 countries. Users in London received 25 WLD tokens for scanning their irises. WLD tokens became freely tradable on several cryptocurrency exchanges, though not in the U.S.

Design

Worldcoin hopes to provide a reliable way to authenticate humans online called World ID, to counter bots and fake virtual identities facilitated by artificial intelligence. Worldcoin attempts to recruit new users to join its network by getting their iris scanned using Worldcoin's orb-shaped iris scanner in return for some WLD tokens. In order to access their WLD, users are required to provide an email address or phone number and use the Worldcoin app. Worldcoin claims the distribution mechanism was inspired by universal basic income discussions.

Ten percent of all WLD tokens are reserved for Worldcoin investors, and another 10 percent are reserved for Worldcoin employees. Worldcoin uses so-called "operators" to sign up new users. These are independent contractors paid per sign-up in Tether stable coin.

Legal and regulatory issues

The currency has not formally launched in the US and other countries because of concerns by national regulators regarding privacy and potential use of the tokens for fraudulent purposes.

In July of 2023, the data protection authorities in both France ( CNIL) and the United Kingdom ( Information Commissioner's Office) announced they had opened investigations into Worldcoin over privacy concerns. In addition, regulators in Bavaria and South Korea also announced they had opened investigations.

In August 2023, Kenya, one of the first countries where Worldcoin was launched, suspended its enrollment in the country, citing security, privacy and financial concerns. Worldcoin was previously ordered to stop collecting personal data by the Kenyan Office of the Data Protection Commissioner, but did not comply. Worldcoin also stopped offline verifications in India. The same year, Worldcoin suspended operations in Brazil and Kenya.

In late January 2024 representatives of the Hong Kong Office of the Privacy Commissioner for Personal Data executed warrants on six Worldcoin offices in Hong Kong. Some of the offices had been used to collect iris scans. The commissioner's office expressed concern the company's collection and processing of iris scans might violate the Personal Data (Privacy) Ordinance and could carry the potential for abuse of personal information. On 22 May, the Office after investigation found Worldcoin has violated the privacy rules through collection of face and iris images from those participating in the project.

On March 6, 2024, the Spanish Data Protection Agency (AEPD) ordered Worldcoin to stop its activity of “collection of biometric data” and to “block all data collected in Spanish territory”. It ordered the temporary suspension using the "urgency procedure" contained in Article 66 of the General Data Protection Regulations. Worldcoin unsuccessfully sought an injunction from the High Court in Madrid to prevent the order coming into effect.

On March 26, 2024, the Portuguese data protection authority—CNPD—made a similar temporary order to prevent data collection over concerns including the inability to withdraw consent, "deficiencies in the information provided to the data subjects" and the collection of data from minors.

References

External links

* {{Official website

Cryptocurrency projects
2023 software