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What is WorldCoin?
WorldCoin is a project of the “Tools For Humanity“, behind which is OpenAI CEO Sam Altman and Alex Blania.
The goal of WorldCoin is to create a layer of identities on the Internet behind which human beings are certified to exist while allowing their privacy.
According to the project, by creating this tool they want to light the way to global voting and even a universal basic income, while fighting against AI-based internet bots and enabling global inclusion in the financial and economic system.
How does WorldCoin work?
Before we understand how it works let’s break down some elements of this project
WorldCoin(WLD): is a token issued on the Ethereum network, has a maximum supply of 10 billion and at the time of its launch only about 1% of the total has been put into circulation. People receive this token for the simple fact of being people, as they say themselves. But in my opinion that is false, the correct thing would be to say that they receive it for the fact of registering their identity, which is what happens.
Worldcoin (WLD)
WorldID: It is the identity of each individual in the network, an identity registered through the orbs and the App, in principle the identities would have some privacy, as it would be something like the Ethereum wallets, it is public what you do your identity is public (wallet address) but who is behind it is private. But with the WorldID we ensure that behind each identity there is a real person although we do not know who, hence they call it the process “Proof of Humanity”, ie: Proof that you are human.
WorldApp: It is the application used to manage the identity for each user. Developed by TFH, it is basically the frontend or interface for the protocol, it is expected that in the future there will be others from third parties to decentralize this part of the chain, and the bet is that everything is open source, although at the moment not all parts of the project are open source, for security reasons, as stated on its official website, they hope that in the future it will be.
Orbs: They are retinal scanners that this foundation has distributed all over the world. The retinal scan together with the app is what is needed to create an identity.
Premises driving the project:
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Proof of person is a missing and necessary digital primitive. This primitive will become more important as increasingly powerful AI models become available.
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Scalable and inclusive proof of person allows, for the first time, aligning the incentives of all network participants to add real humans to the network. Bitcoin is issued to secure the Bitcoin network. Worldcoin is issued to grow the Worldcoin network, with security inherited from Ethereum.
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In an era of increasingly powerful AI, the most reliable way to issue a global proof of person is through customized biometric hardware.
What they hope to achieve
And the conclusions of the project I found on their own website:
Worldcoin could significantly increase equality of opportunity globally by moving towards a future where everyone, regardless of location, can participate in the global digital economy through a decentralized and universally accessible financial and identity infrastructure.
Today, many interactions in the digital realm are not possible globally. The way humans transact value, identify and interact on the Internet will likely change fundamentally.
The intersection of finance and identity would enable incentive alignment: loyalty programs, referral programs, and generally sharing value with customers is traditionally prone to fraud. Frictionless, fraud-resistant digital identity helps align incentives and benefit both consumers and businesses.
Equitable distribution of scarce resources: Crucial elements of modern society, including subsidies and social welfare, can be made more equitable by employing the person test. This is particularly relevant in developing economies, where social benefit programs face the problem of resource capture. As AI advances, fairly distributing access and some of the value created through UBI will play an increasingly vital role in countering the concentration of economic power. World ID could ensure that each individual registers only once and ensure equitable distribution.
In a nutshell
How it works:
We download the app –> We visit an Orb and thus mint an identity and receive some Worldcoin –> We use that identity in applications.
Purpose:
Ensure that all users on blockchains and the internet are human and thus promote financial inclusion on the web and improve economic interactions by enabling more inclusive and equal access.
Opinion and criticism of Worldcoin
They have been criticized in some international media because their current user base is mostly third world people who have been “exploited” to register.
This is a criticism that seems ridiculous to me, since it is impossible to be exploited without the use of violence or force, offering something to someone cannot be exploitation. Offering $5 an hour in a country where there is $4 to spare is not exploiting anyone, in the same way that in a country where $10 an hour is offered, $12 an hour is not exploitation either. What I do find objectionable is to sell themselves as a user base when in fact they are “bought” users. But on the other hand it is a typical practice in crypto sector projects, sometimes a bit regrettable, sometimes a successful tactic, and there are plenty of examples of both.
One thing that has caught my attention reading the official documentation of the project is the fact of having read: “we expect these identities to be used by those who mint them”. Already today we can confirm that these identities are being bought and sold on the black market.
It does not seem to me to be a sound project at all for the following functional reasons:
First of all, identities can indeed be sold, thus compromising the security of applications and projects that need that identity to be self-authenticating, and they can also be forged. As the project itself indicates, they believe in decentralization and that other companies should also manufacture and distribute the Orbs. Why can’t fake human eyes be used? If these passports were to become widely used, the incentive to counterfeit them would grow and the money would flow towards that goal.
Secondly, if they can be bought and sold, what advantages does it have over an ethereum identity? I mean, a wallet, since with wallets there are applications that issue NFT’s that certify that you have passed a certain course, moreover with non-transferable NFT’s, i.e. they are associated with that identity. But what prevents reselling a full wallet? Of course the buyer would have to trust the seller, but still. Or simply that the course or the app issuing the NFT cert gives it to someone who is actually using a third party to do that course….Nothing prevents it. But here the point is: it is more expensive and cumbersome than an identity in Ethereum, less integrated in the ecosystem and does not bring enough added or distinctive value, except: “proof that there is a human behind it”, something that Ethereum wallets can also bring in the same way through many other mechanisms, simpler and more effective, otherwise, see Gitcoin and its passport, although there are many more, such as Civic.
Target problems:
Illustrating global voting and universal basic income is a very vague and totally inapplicable statement, the world moves by incentives and power, not by an elite that plans in favor of others, nor is there a global power that organizes the economy, nor is there any incentive at the moment to have one.
In addition, universal basic income is a chimera that has proven to be inapplicable in most countries, due to lack of resources or implementation problems (tests have already been carried out in countries such as Japan or Finland) and the results were not very comforting. However, if one day the IGA, the universal basic income, will arrive, it could make sense at a theoretical level, but it is also true that implementing it has its difficulties and risks, and I personally shy away from the idea of social engineering from above. Democracies and free systems work thanks to a balance of power, not thanks to the good will of the powerful. What I mean is that the implementation or not of universal basic income in that fictitious scenario where AI replaces all human labor (it could happen), will not depend on the will and desire of individuals or on the good work of expert “social engineers”, but on the balance of power and incentives of each entity involved: individuals, companies, governments, organizations, etc.
However, the other objectives of the project make much more sense and are more achievable: global financial inclusion and the fight against AI-based bots.
And global financial inclusion is a noble goal to achieve, since there are still billions of people without banking services who cannot access them, good examples are India and Africa. But Ethereum and Bitcoin, among others, have already done a great job here enabling them to have many financial asset classes, no wonder some of these countries are the first in the world in terms of number of users. From Bitcoin to stable currencies like USDC or USDT to financial services of all kinds based on the blockchain or fully centralized applications.
What does Worldcoin contribute here? Ensuring that a wallet has a real person behind it…but nothing more. Knowing that that real person may have sold his ID, knowing that even IDs will be forged at the time of issuance, knowing that in Ethereum there are more robust and less expensive and much more flexible alternatives, to verify identities…what does WolrdCoin contribute? In my opinion, at first glance, it seems like not much.
The fight against bots: I have had a thesis for years: the Internet is going to break in two, on the one hand a centralized and free Internet where the product is the people who use free services in exchange for advertising, for that to be profitable we need to know that they are personal, with the rise of AI is becoming more and more difficult to differentiate people from bots, in the future it may be impossible, hence they have to be verified identities, if or if, it is a matter of incentives.
And the other internet, will be an open internet, free, decentralized and with much greater anonymity, that internet will be paid and largely through cryptocurrencies.
Worldcoin would be a statement of this own thesis, but I think it is likely to fail, as I said I believe that identity verification on the blockchain is more developed than what WorldCoin offers, and in addition, much of the internet will verify through ID, electronic signatures, phone numbers, bank proof, etc.
Source: Worldcoin Website.
