The buzz around the Worldcoin identity verification project was glaringly evident after Monday’s launch, with the linked crypto token, the WLD, reaching an eye-catching $3.58 on crypto exchanges, as per CoinMarketCap data. Nevertheless, such initial gains have since deflated, arguably mirroring the crypto community’s uneasiness tied to several elements of the project.
The Worldcoin project, co-founded by OpenAI’s Sam Altman, utilizes a hardware unit called the Orb which identifies individuals and verifies their human-ness by iris scanning. Potentially profound in a future digital economy infused with AI, authenticated users can claim WLD tokens via a corresponding app, in areas where regulations permit.
But this has not been devoid of criticisms. Ethereum co-founder Vitalik Buterin aired concerns over potential misuses focused on privacy, centralization, and security. The company’s aggressive marketing tactics in the developing world is another contentious point. Hand in hand with an alarming 30% of its user base in Asia and Africa, this has elicited exploitation apprehensions.
One of the critical voices, crypto influencer ZachXBT, referred to a story by the MIT Technology Review, illustrating the firm’s deployment of deceptive marketing strategies, undisclosed collection of large quantities of personal data, and questionable informed consent.
Adding weight to these concerns, the U.K. data watchdog has recently announced an inquiry into the project, implying that the company’s data collection methods may be dubious. Nevertheless, the firm insists its commitment to the strictest privacy standards where Worldcoin is available.
Worldcoin’s investor portfolio may also be part of the problem. Among its black sheep investors is Sam Bankman-Fried, FTX crypto exchange’s now bankrupt CEO. Allegations of fraud against Bankman-Fried, coupled with Kyle Davies, the co-founder of the bankrupt Three Arrows Capital, hinting at investment in Worldcoin, only serve to compound the negativity.
Aside from questions of integrity, Worldcoin’s tokenomics, with trading analyst Dylan LeClair characterizing it as “launching and pumping a microcap shitcoin with 1% of total supply in circulation”, provides further fuel for skepticism.
A sudden increase in token allocation from 20% to 25% and a notably low circulating supply due to attempts at creating a vast human network, raise a few eyebrows. More so when William Mougayar, an author and investor argued that primarily, the project launch has minimal utility and opens doors for speculative trading. Additionally, he voiced his discontent at the short lockup period for early investors in relation to the project’s grand ambitions.
Still, with Worldcoin boasting of over 2 million Orb-verified users and an ever-increasing token allocation, perhaps only time may truly reveal the project’s fate, and whether it can pacify its critics.
Source: Coindesk
