The Worldcoin cryptocurrency project founded by Sam Altman, executive director of OpenAI, is making its international debut. Before considering its potential, it is worth first understanding what the cryptocurrency offered by the ChatGPT creator actually is, and whether it is worth investing in?
What is WorldCoin and why can't everyone buy it?
Worldcoin (WLD) is a cryptocurrency project founded by Sam Altman, executive director of OpenAI. Its centrepiece is a token called Worldcoin, running on the ethereum blockchain system. Users wishing to use this cryptocurrency must first confirm their identity using a physical 'orb' called Orb, which scans the eyes. The project's creators believe that this is a necessary step for the future. Distinguishing between the actions of humans and robots is, after all, already becoming increasingly difficult today due to the development of artificial intelligence.
It is important to note, however, that due to the stringent regulation of digital assets in the United States, Worldcoin will not initially be available in the US.
Worldcoin's main goal is to build the world's largest network of 'identity' and finance as a public service, with the aim of providing ownership for everyone. The WLD token is based on the ERC-20 standard of the Ethereum network, and users receive their Optimism Mainnet grants. The World ID protocol allows individuals to prove their identity and uniqueness across platforms such as web3 systems, social networks and government programmes. This is intended to enable tokens to be fairly distributed, sold, NFT and protected from bot attacks on social media, as well as more equitable distribution of scarce government resources. World ID, as envisioned, could support global democratic processes and new forms of democratic decision-making, and in the future could pave the way for AI-funded Universal Basic Income (UBI) redistribution.
Currently, more than two million people from more than 30 different countries have verified their data with Orbach in the pre-launch period, which runs from May 2021 to July 2023. At launch, Worldcoin is beginning to deploy 1,500 Orbs in more than 35 cities in more than 20 countries to meet global user identity confirmation requirements.
Worldcoin's sluggish debut and why the cryptocurrency has no economic foundation
For its debut market entry, Worldcoin raised more than US$250 million in several rounds of funding from investors and investment funds. The cryptocurrency was available for purchase through various cryptocurrency exchanges and the World App. On the first day of trading, the price of the cryptocurrency increased by more than 50%. - From less than US$2 up to US$3.3. However, the price has since managed to return to around USD 2.
Source: https://coinmarketcap.com/currencies/worldcoin-org/
One of the problems facing the Worldcoin cryptocurrency appears to be the attempt by its creators to spell basic economics. The main success factor they point to is the complete lack of anonymity and the giving away of the cryptocurrency to every user. This seems to contradict the original premise of cryptocurrencies.
However, the biggest challenge for Worldcoin is one of the basic assumptions, which involves universal gifting to users. The creators emphasise that this mechanism would lead to the democratisation and spread of cryptocurrency, as everyone would want to receive cryptocurrency for free. Unfortunately, the price of cryptocurrency always depends on supply and demand. By only stimulating supply without stimulating demand at the same time, this leads to the devaluation of cryptocurrency in the long term. Therefore, it is very doubtful that Worldcoin will become more widespread than bitcoin or ethereum.
Source: Conotoxia MT5, BTCUSD, Daily
Grzegorz Dróżdż, CAI MPW, Market Analyst of Conotoxia Ltd. (Conotoxia investment service)
Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
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