The launch of the controversial digital ID crypto project, Worldcoin, has stirred up a wave of attention and debate. Led by Sam Altman, the CEO of OpenAI, Worldcoin made headlines with its promise to introduce a futuristic digital identity system based on iris scanning, differentiating humans from artificial intelligence (AI) entities.
The process — proof-of-personhood — generates a unique World ID, with all biometric data stored on a decentralized blockchain. The innovation lies in the zero-knowledge proof mechanism, which enables human verification without divulging the underlying data.
Despite generating controversy from its inception, Worldcoin secured an impressive $115 million in funding in May and amassed over 2 million sign-ups before its debut. The official launch, which took place on July 24, was met with a somewhat lukewarm response.
Critics of the project, however, have raised concerns about data privacy, questioning Worldcoin’s approach to securing and managing personal information. While the project asserts its compliance with relevant laws and regulations, experts have highlighted potential vulnerabilities in its design. Cybersecurity specialists and Ethereum co-founder Vitalik Buterin have raised red flags regarding the methodology employed to generate World IDs.
The company now plans to make its technology available to businesses and governments to implement localized systems without collecting personal information, which could have several implications.
Finally, the project’s avoidance of launching its token in the United States illustrates a keen understanding of potential legal hurdles. With attention from regulatory bodies in the United Kingdom and the European Union, as well as concerns raised by industry experts, Worldcoin’s path forward is complex. The delicate balance between innovative digital identity solutions and individual rights will likely dictate the project’s fate in an ever-evolving landscape of data and privacy regulations.
This week’s Crypto Biz looks at Worldcoin’s expansion plans, GameStop’s exit from crypto, MicroStrategy’s quarterly results and Nomura’s crypto license in Dubai.
Worldcoin to allow government and businesses to use ID system
Worldcoin plans to expand operations to allow governments and businesses to utilize its iris-scanning and identity-verifying technology to boost user sign-ups. According to Worldcoin developer Tools For Humanity, the company is on a mission of “building the biggest financial and identity community” possible, enabling third parties to use its iris-scanning technology. Worldcoin intends for companies to pay to use its digital identity solution if they want to implement localized systems without gathering personal data.
GameStop will stop support for its crypto wallets, citing “regulatory uncertainty”
Gaming retail company GameStop announced plans to remove its digital wallets from the market starting in November, citing “regulatory uncertainty of the crypto space.” The wallets, launched in May 2022, allow users to manage cryptocurrencies and nonfungible tokens. GameStop advised users to ensure access to secret passphrases by Oct. 1. It’s unclear to which aspects of “regulatory uncertainty” the company was referring. GameStop is headquartered in the U.S., where lawmakers and regulators have taken controversial approaches to crypto and blockchain.
MicroStrategy returns to profit and now owns $4.4 billion worth of Bitcoin
MicroStrategy — one of the largest corporate holders of Bitcoin (BTC) in the U.S. — returned to profitability in the second quarter amid a surge in the price of Bitcoin. The company reported $22.2 million in net income, a massive swing from a net loss of $1.1 billion in 2022. Total revenues were mostly flat at $120.4 million. The company is also planning to raise up to $750 million through a stock sale and says it may use the proceeds to buy more Bitcoin to get ahead of the next halving. The firm currently holds 152,800 Bitcoin, worth ~$4.5 billion at current prices. It added 12,333 Bitcoin in the second quarter and another 467 in July.
In July, @MicroStrategy acquired an additional 467 BTC for $14.4 million and now holds 152,800 BTC. Please join us at 5pm ET as we discuss our Q2 2023 financial results and answer questions about the outlook for #BusinessIntelligence and #Bitcoin. $MSTR https://t.co/SCHeBJ80TH
— Michael Saylor⚡️ (@saylor) August 1, 2023
Nomura’s crypto arm Laser Digital bags Dubai VARA license
Japanese giant Nomura has received an operating license from Dubai’s Virtual Asset Regulatory Authority (VARA) for its digital asset subsidiary, Laser Digital Middle East. The license will allow it to offer broker-dealer and investment services, as well as virtual asset management in the emirate. Additionally, the permit allows the firm to conduct trading and asset management operations in the coming months, including over-the-counter services and a “range of digital asset investment products and solutions.”
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