Author: MORBID-19

Compiled by: TechFlow

Keyword of the Week: Worldcoin

Worldcoin is a project that issues Worldcoin (WLD) tokens to individuals who prove they are human via an iris scan. Its purpose is to ensure a basic income for humans in a future where AI may replace jobs. Created by Sam Altman of OpenAI, the project has become widely known.

In South Korea, about 90,000 people downloaded the World App, of which about 30,000 completed iris authentication. However, the project faced legal challenges in South Korea and was fined more than 1.1 billion won (about $800,000) for violating the Personal Information Protection Act.

According to Yonhap News:

The investigation revealed that the Worldcoin Foundation and TFH, which was entrusted to process personal information, collected personal information including iris data without legal permission and failed to comply with the (Personal Information Protection Act) when transferring this data overseas.

It is important to note that when the Worldcoin Foundation collected iris information in South Korea, it did not promptly inform users of the purpose of collection and use, as well as the retention and usage period.

Iris codes are sensitive information that can identify individuals and cannot be changed, so there should be separate consent and security measures, but these requirements were not met.

The investigation also confirmed that the Worldcoin Foundation and TFH transferred personal information collected in South Korea to foreign countries, including Germany, without notifying users.

Additionally, the Worldcoin Foundation did not establish a method to request removal or suspension of iris code processing, and TFH’s age verification for children under 14 during the World App registration process was found to be inadequate.

This news is particularly significant because South Korea accounts for a large portion of WLD’s trading volume. As of October 6, South Korean exchanges account for approximately 16% of total WLD trading volume. Of this, the majority of trading volume occurs on Bithumb, making it the second-most traded exchange after Binance.

Percentage of WLD volume on Korean exchanges

In July, @DefiSquared harshly criticized Worldcoin on Twitter, pointing out that WLD's valuation was abnormally high, the project team showed signs of price manipulation, and the token economics model was extremely favorable to insiders. He warned that retail investors in South Korea could become "unfortunate victims" and pointed out that although only 2.7% of the total supply of WLD is in circulation, the fully diluted value (FDV) has reached $30 billion, with about 25% of the circulating supply stored on Bithumb.

[...] Many of them may not even be able to read enough English to understand the situation. As of this writing, nearly 25% of all circulating WLD is stored on Bithumb, and the emission of tokens to be unlocked, while approaching, continues to increase:

This is not a shitcoin chart

Google Trends also shows that the keyword “Worldcoin” (월드코인) in Korean is closely correlated with WLD’s price action, suggesting that Koreans were more likely to buy WLD during its peak. WLD rose to about $12 and has experienced a nearly 90% decline since then.

What’s even more regrettable is that not only young people who are savvy with cryptocurrency, but also senior citizens were attracted by Worldcoin and went to Orb locations to undergo iris recognition and obtain WLD tokens. Although it is unclear whether these senior citizens purchased WLD tokens, if they did, they may have suffered significant losses.

Orbs are installed in multiple locations in Seoul, especially in dining establishments. Operators of these Orbs receive WLD as a reward for each new iris authentication. This has led to a marketing strategy whereby venues encourage visiting patrons to perform iris authentication in exchange for “free tokens.”

This marketing approach has raised concerns about the collection of iris information from unsuspecting elderly people. In March, when Worldcoin reached its peak popularity, South Korea’s Personal Information Protection Commission began an investigation due to a large number of complaints.

Worldcoin Orb distribution map in Seoul

While it is theoretically impossible to reconstruct an individual’s biometric information from the iris code generated by the Orb scan, most people do not fully understand Worldcoin’s technology. The fact that scanning an iris can be offensive may be one of the reasons for the controversy.

Searches for Worldcoin (35.1%) outpaced all other keywords combined

One interesting thing I’ve noticed is that there is a huge demand for Worldcoin related content on YouTube. In the search statistics for my channel, the keyword “Worldcoin” accounts for about 35% of the searches, more than twice the next most searched keyword.

A quick search for Worldcoin on YouTube will reveal many related videos predicting price increases and potential positive developments. This is not surprising, as YouTube is the second largest platform for obtaining information in South Korea, second only to Naver.

Search platform rankings in South Korea: Naver, YouTube, Google, Instagram, Namuwiki/Wikipedia, Kakaotalk, Daum, ChatGPT, Facebook, X

Koreans rely primarily on Naver for information search, followed by YouTube, rather than Google. While English speakers primarily use Google, Korea has unique communities like “Naver Cafes” that generate a wealth of information that can only be found on Naver.

As a result, many people looking to invest in cryptocurrencies often encounter misleading information or, in severe cases, fall victim to pyramid schemes. The isolated environment created by the Korean language and Naver not only creates challenges for projects looking to enter the Korean market, but also makes it difficult for Koreans to discern accurate information.