The cryptocurrency phenomenon has spread like wildfire, and after the inception of Bitcoin, numerous projects have emerged in the space, among which Worldcoin stands out as a revolutionary as well as controversial concept. Created by OpenAI CEO Sam Altman, Worldcoin is an open-source protocol that aims to offer everyone access to the global financial economy. As empowering as it is, Worldcoin has been criticized for encouraging adoption by asking users to scan their eyeballs to get free WLD coins, which has raised privacy concerns.
Considering that this project is still in its infancy and presents both opportunities and challenges, before checking the worldcoin price, it only makes sense first to understand how it works. So, if you’re a newcomer to the crypto space and are interested in Worldcoin, this guide will give you valuable insights into this project so you can make an informed decision on whether to buy it or not. Read on!
What is Worldcoin?
Worldcoin was created to enhance economic opportunity, scale a dependable solution for separating AI and humans while ensuring privacy, empower universal democratic processes, and illustrate a path to a universal basic income that is AI-funded. Worldcoin relies on three main tools that work together to achieve its goals, including World ID, which eliminates identity-based biases, Worldcoin token, the cryptocurrency that is freely distributed to individuals, and World App, representing a self-custodial app that enables transfers, payment, and purchases with WLD, stablecoins, traditional currencies, and other digital assets.
Worldcoin was launched on July 24, 2023, and it attracted two million users during its beta period. Its orbing operations refer to offering the Orb to various qualified Worldcoin Operators, who will earn money by signing up people via the Orb. Those signing up in specific areas of the world will also be rewarded with WLD tokens.
What are Worldcoin’s tokenomics?
All Orb-verified individuals with World IDs can recur claims of free WLD tokens, which is a move that makes WLD the most widely distributed crypto asset. Starting with its launch date, the token has locked a total supply of 10 billion tokens for 15 years and is enforced by a smart contract. At the end of these 15 years, it will be up to the governance to decide if they will include an annual inflation rate to support the protocol in the long run. Currently, the 10 billion WLD tokens have been distributed among different stakeholders: 75% of them have been distributed to the Worldcoin community and 9.8% of them to the initial development team, while The Tools for Humanity investors have received 13.5% of the tokens.
WLD features governance properties, giving holders the power to influence the future of the token to a certain extent. Apart from the one-token-one-vote mechanism common for governance tokens, thanks to its World ID feature, WLD offers a one-person-one-vote mechanism. Furthermore, combining the two mechanisms can create new ways of governance.
How does Worldcoin work?
There are three main steps to using or getting WLD. First, you need to download the World App, which is available on iOS and Android devices alike and operated by Tools for Humanity, a global tech enterprise founded to enhance the transition toward a fairer economic system.
Once you’ve downloaded the app, the next step is to set up your account so you can access a digital wallet connected to WLD. This digital wallet isn’t only dedicated to Worldcoin; you can also use it for cryptocurrencies like ETH, BTC, and even traditional currencies and stablecoins. After you’ve accessed the wallet, sign up for World ID by visiting a Worldcoin Operator and verifying your unique identity with the help of an Orb. This is essentially a smooth and round tool that will scan your iris as you stare into the Orb’s black circle. The purpose of this process is to determine and record your identity. The Orb uses a system of infrared cameras, sensors, and AI-powered neural networks, which verify people’s features to make sure they are human. The Orb further generates a digital World ID that can be used pseudonymously to ensure that the person’s identity won’t be revealed.
Finally, you will acquire your WLD tokens alongside other cryptocurrencies, and you can use the World App to learn more about the crypto industry and receive airdrops of other digital assets.
What are the risks and challenges associated with Worldcoin?
Worldcoin has made significant efforts to verify human identities, but the project still has a long way to go. At the moment, it faces some notable challenges and risks, such as accessibility. Worldcoin has just 1,500 Orbs, which will be available in 35 cities in 20 countries. However, there are more than seven billion people in the world, meaning that 1,500 Orbs won’t really be enough for the global population. On top of that, even if the team behind Worldcoin succeeded in producing the necessary number of Orbs, some governments could ban their use, just as has happened with cryptocurrencies over the past few years.
Moreover, the project has been around for the last three years, managing to sign up two million users, which raises concerns about how many years (and Orbs) it will take to get more people to sign up. And that’s not all when it comes to Worldcoin’s challenges. Privacy is also a major concern, as the technology could capture sensitive data about individuals, such as their ethnicity, sexual orientation, and medical condition, to name a few, which could be misused if it ends up in the wrong hands. It’s essential to address these challenges for Worldcoin to see increased adoption and instill trust, but as Vitalik Buterin stated, creating a robust system will take a few years.
The bottom line
Worldcoin is still in its early days, so there’s still time for it to unlock its full potential. However, many believe that the project can influence different fields, including technology and AI, as well as the world economy. In AI, Worldcoin will continue to differentiate humans from AI-generated bots and give them the required access.
As of now, it’s difficult to predict the future of Worldcoin with certainty because the project still faces numerous roadblocks that can hinder its scalability and adoption. If you’re interested in buying WLD, remember to do your research so you can understand both the advantages and disadvantages of this project and how it fits in with your investment portfolio. As with any cryptocurrency, WLD isn’t for everyone, so you need to decide for yourself if you want to buy it or not after considering your own circumstances and goals.
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