Crypto start-up Worldcoin, which aims to get free cryptocurrency into the hands of "as many people as possible," has raised $100 million from investors, including Andreessen Horowitz and Khosla Ventures, The Information reported, quoting sources.
The money was raised via a token sale, which essentially involves generating and selling cryptocurrency to initial investors for fiat currency. The total supply of the company’s tokens is now reportedly $3 billion.
Worldcoin, which has sensitive biometric data of 450,000 people, is contending with fraud attempts, logistical hurdles, and had to terminate operations in several countries, according to Bloomberg.
Incidentally, Khosla Ventures' founder Vinod Khosla also heads a start-up incubator which launched AadhaarBridge (now known as Veri5Digital) which used to be a licensed Authentication User Agency (AUA) for Aadhaar.
Crypto in Exchange for an Iris Scan
Worldcoin, co-founded by former Y Combinator President Sam Altman, pitches itself as a "new, collectively owned global currency that will be distributed fairly to as many people as possible."
It believes that if a cryptocurrency were adopted at scale, it would vastly increase access to the internet economy and make "applications possible that are now unimaginable."
To bring this dream to fruition, it plans to allow everyone to claim a share of its tokens for free. However, there are a two hurdles:
Ensuring that every person on Earth can prove that they are human, not a bot.
Making sure they have not claimed their free share of Worldcoin already, without collecting and maintaining a database of personal data.
"This challenge is the longstanding problem of proving unique-humanness without intruding on privacy: how can you prove you are you, without having to tell us anything about yourself?" it says on its website.
To solve this, they built a new device called the Orb. It captures an image of a person’s eyes and converts it into a unique numeric code, making it possible to check whether the person has signed up already.
The original photo is deleted and no personal data is required for verification.
Worldcoin has about 30 orbs in circulation and has imaged almost half a million eyes so far, according a Bloomberg report. Chief Executive Officer Alex Blania, however, estimates it would have 6,000 orbs and 20 million to 30 million registrants by the end of 2022.
A Dystopian Future?
Worldcoin’s launch has been delayed multiple times; it is now expected to launch late 2022. It also reportedly faced attempts at fraud and has been forced to cease operations in several countries for different reasons.
Turkey banned cryptocurrency in April and Sudan experienced a coup in September. In countries such as Ghana, France, and South Africa, local contractors reportedly found the work too demanding.
Early adopters are required to sign a release form allowing Worldcoin to store images of their eyes and three-dimensional mapping of their bodies and faces, in order to train its algorithms.
This means that a secretive start-up, with limited experience, has unique biometric data on thousands of people across the globe, which raises serious concerns about privacy.
“If your Social Security number leaks, you can get a new Social Security number. If your credit card number leaks, you can get a new credit card number. If a biometric scan of your face leaks, you can’t get a new face,” Evan Greer, deputy director of the digital rights group Fight for the Future, told Recode.
John Davisson, an attorney at the Electronic Privacy Information Center (EPIC), told the publication that this company and this currency should simply not exist since there isn't much assurance that Worldcoin will be able to protect the sensitive data.
There also isn't any confirmation that Worldcoin's eye-scanning technology is watertight and can't be bypassed.
Projects like this, which could pose serious threats to user privacy, is why Vitalik Buterin, the co-creator of Ethereum, told Time that cypto has "a lot of dystopian potential if implemented wrong.”
(With inputs from Bloomberg, Recode, The Information, and Time.)
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