Is Worldcoin Legit? Unpacking the ChatGPT Founder’s New Crypto Project

Would you trade your biometric data for some crypto?

Giant eyeballs flying out of Sam Altman's open skull.
Created by Gabor Kovacs from DailyCoin

“Is Worldcoin Legit?” The question is on the tip of everyone’s tongue following the launch of WLD tokens on top crypto exchanges like Binance. Brought to you by the co-founder of ChatGPT, Sam Altman, Worldcoin has all the hallmarks of a revolutionary cryptocurrency project.

Created by OpenAI and Tools For Humanity, the Worldcoin Project is a decentralized and open-source protocol that aims to help us prove our humanness in a world that is becoming more populated by bots and artificial intelligence by the day.

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On the surface, Worldcoin sounds like a noble pursuit using Web3 and blockchain technology to benefit millions and provide low-resource nations with a UBI (Universal Basic Income). But critics have fought back.

Is Worldcoin a necessary step into our digital future, or is OpenAI’s newest toy a simple data collection technique designed to make Silicon Valley investors rich?

What is Worldcoin (WLD)?

Worldcoin is a crypto project and digital ecosystem designed to verify that you’re a real, unique human being: no bots or AI, just good old-fashioned homo sapiens.

At the heart of the Worldcoin ecosystem is your individual World ID, which functions like a digital passport saying, “Hey, I’m a real person, not a robot!” Worldcoin calls this ‘Proof of Personhood’ and argues that being able to prove your humanity will be an essential part of navigating our future digital society.

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As a reward for creating your World ID, you’ll be given a small amount of Worldcoin tokens, the native cryptocurrency of the ecosystem, which can be used to exchange value in the blockchain economy. As expected, these WLDs can immediately be traded for other crypto assets like Bitcoin (BTC).

But how does one create a World ID and join the Worldcoin movement?

How Does WorldCoin Work?

Things get mildly dystopic here, and if you’ve seen Minority Report, you’ll understand why. To join the Worldcoin ecosystem, you’ll need to get your eyeballs checked out.

Using the Worldcoin Orb, a custom biometric device that scans your iris. This iris scan is converted into a unique code, known as an “IrisCode or IrisHash,” a bit like your digital fingerprint proving that you’re a real, unique human. 

OpenAi and Worldcoin say all images are promptly deleted on-device for privacy. Using zk-proof technology, your proof-of-personhood, and human uniqueness can be shared without revealing the sensitive personal data of your World ID.

Orb Operators are currently undergoing a world tour to collect Irises and onboard millions into the Worldcoin ecosystem.

Why Do We Need Worldcoin?

In the digital age, proving you’re a real, unique human is surprisingly tricky. A quick captcha code isn’t blocking anyone, despite what you might believe. With the rise of AI and bots, it’s becoming harder and harder to tell who’s a human and who’s a machine on the internet. 

The lack of clarity around digital identities is a real problem, especially regarding things like online voting, distributing value, or even keeping bots out of your Crypto Twitter feed.

By creating a “proof of personhood,” Worldcoin aims to solve this problem. It’s like a digital ID that verifies you’re a real, unique human, not a bot or an AI. And because it’s based on your iris, which is as unique to you as your fingerprint, it’s tough to fake.

Worldcoin’s bold vision doesn’t stop there. In theory, participants can instantly transfer WLD tokens from one World ID to another, transferring wealth between people and across borders faster than ever.

The creators of Worldcoin believe that the current methods of cryptocurrency distribution are not equitable, often favoring those with more resources and technical knowledge. By rolling out Orb Operators in low-resource countries, Worldcoin claims they’re democratizing digital wealth and boosting financial inclusion worldwide. 

The WLD Airdrop

You don’t just get a digital ID when you scan your iris by the Orb. You also get a small amount of Worldcoin tokens or WLD. These WLD tokens live on the Ethereum (ETH) blockchain but will likely be compatible across Layer-2 networks as the Worldcoin platform grows.

But why give away tokens? Well, it’s all part of Worldcoin’s mission to create a more inclusive global economy. By distributing tokens to users, Worldcoin is putting wealth directly into the hands of the people and rewarding them for contributing to the growth of the protocol. 

The average value of the WLD Airdrop is around 25 tokens, which is around $50 USD at the current price of WLD. As you can imagine, this ‘trade-your-iris-scan-for-cryptocurrency’ concept has raised a few eyebrows.

Is Worldcoin Legit? Concerns and Controversy

As with any groundbreaking cryptocurrency project, Worldcoin has been met with intrigue and skepticism. While its mission to democratize access to digital wealth is laudable, the project has also raised several concerns.

  • Biometric Data Collection – Let’s talk about the elephant in the room. Critics question the privacy and security implications of collecting iris scans on such a large scale. While Worldcoin maintains that the data is used solely for ensuring fair distribution and is not stored, skeptics worry about potential misuse or breaches. There is a chance that hackers could use the hashes from scans to replicate identities.
  • Targeting Vulnerable Populations – The project has been criticized for targeting lower-income communities in nations like India and Indonesia for its initial distribution. It’s arguable that these populations may not fully understand what they are signing up for and may be more susceptible to exploitation.
  • Legal Issues – The practices of Worldcoin may violate the European Union’s General Data Protection Regulations (GDPR) and local laws. For example, in Indonesia, gratuities given to government officials to facilitate desired actions are—with rare exceptions— illegal under Indonesia’s anti-corruption and anti-bribery laws.
  • Ethical Concerns – For a crypto project that aims to provide financial inclusion and bring wealth to impoverished areas, Worldcoin has a rather centralized token supply allocation. To give you an idea, 10% of WLD is allocated to the team, with an additional 10% distributed to early investors like Andreessen Horowitz.
  • Immense FDV (Fully Diluted Valuation) – WLD is arguably overvalued at its current price. At an FDV of over $20 Billion USD, Worldcoin ranks higher than established crypto projects like Cardano (ADA) and Solana (SOL)

Worldcoin History

Worldcoin’s history is a tale of ambition, innovation, and controversy. The project was conceived by Sam Altman, the former president of the renowned startup accelerator Y Combinator and one of the co-founders of OpenAI. With the vision of creating a fairly distributed cryptocurrency that benefitted as many people as possible, he teamed up with Alex Blania, a physicist who became the CEO of Worldcoin.

The project officially emerged from stealth mode in late 2021, revealing its unique approach to cryptocurrency distribution. The company developed a device known as the “Orb,” a futuristic-looking gadget designed to scan people’s irises. This biometric data would ensure that everyone only received their fair share of the new digital currency, preventing individuals from claiming more than their allotted portion.

Worldcoin’s launch was met with a mix of intrigue and skepticism. While some lauded the project’s ambitious goal of creating a universally accessible cryptocurrency, others raised concerns about the collection of biometric data and the potential for exploitation of vulnerable populations.

Despite these concerns, Worldcoin pressed forward. The company conducted field testing in 24 countries, focusing primarily on developing nations. By mid-2023, Worldcoin had already scanned hundreds of thousands of eyes, faces, and bodies, intending to reach a billion sign-ups by the end of the year.

Pros and Cons of Worldcoin

Like any ambitious project, Worldcoin comes with its own set of advantages and challenges. Let’s explore the pros and cons of this polarizing crypto project to give you a balanced and objective view.

Pros

  • Inclusivity – Worldcoin aims to create a more inclusive global economy by giving everyone, regardless of country or background, access to a digital identity and financial network.
  • Proof of Personhood – The World ID technology could have significant implications for the digital world, from combating bots and AI to enabling more secure online voting systems.
  • Wealth Distribution – The WLD Airdrop could potentially put wealth directly into the hands of the people, kickstarting the Worldcoin economy and benefitting low-income areas.
  • Reputable Company – Built by the same company that gave us ChatGPT, the Worldcoin team are undoubtedly experts with deep pockets and resources.

Cons

  • Privacy Concerns – Biometric data collection raises significant privacy concerns. Even though Worldcoin claims to delete the original scans, critics argue that the hashes produced by the scans could be used to match future scans.
  • Targeting Vulnerable Populations – Worldcoin’s focus on lower-income communities and developing countries could lead to exploitation.
  • Regulatory Concerns – Worldcoin’s practices, such as Europe’s GDPR Rules, could potentially violate privacy laws.
  • Bloated Value & Investor Allocations – At full dilution, Worldcoin is valued higher than Cardano and Solana, with the team and early investors holding 20% of the total supply.

On the Flipside

  • By distributing cryptocurrency to hundreds of thousands of people worldwide, Worldcoin is bringing new users to the crypto space in droves.

Why This Matters

OpenAI has already proven itself as a leader in the field of disruptive technology. Worldcoin represents the company’s first significant foray into crypto, which may help onboard millions of new users to blockchain technology.

FAQs

Who is behind Worldcoin?

The team behind Worldcoin is none other than OpenAI, the San Francisco-based company that brought us ChatGPT.

How do I invest in Worldcoin?

You can invest in Worldcoin by buying WLD tokens on a crypto exchange like Binance or by getting your irises scanned by a Worldcoin Orb and receiving the airdrop.

Why is Worldcoin not available in the US?

Due to regulatory constraints, Worldcoin is unavailable in some nations like the United States and China.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Finn Miller

Finn Miller is a New Zealand-based blockchain writer for DailyCoin who specializes in simplifying complex blockchain topics. He is experienced in crafting whitepapers, researching on-chain data, and advising emerging crypto projects, and uses his unconventional approach to learning and passion for knowledge to provide cornerstone educational content for readers of all levels. When not exploring the depths of DeFi, Finn can be found exploring his other passion, the great outdoors.