Worldcoin Shows No Sign Of Slowing Down Even As Operations In The EU Hang By A Thread

Tools For Humanity (TFH), the umbrella company of the digital-identity protocol Worldcoin, has been on a shopping spree, buying up top tech talent to help spur up the new "human-first" decentralized network, Worldchain.

A developer preview of the Ethereum layer-two scaling solution went live during the EthCC conference in Brussels on Tuesday, July 9th.

Tiago Sada, head of product at TFH, explained that building a dedicated chain is a necessity born out of the project's success during its first year. With over 6 million unique digital passports created and over 100 million transactions performed by the 10 million users of World App, Worldcoin has "outgrown its current home" on the Optimism chain.

The numbers are quite optimistic, but, as usual, they don't tell the whole story.

Since launching in July 2023, the digital-identity crypto protocol has faced minor abuse accusations, police raids to TFH warehouses, legal investigations in multiple countries on different continents, bans, near-arrests of top decision-makers, and a threat by Italians to never physically launch on their territory.

Of the twenty-one countries where Worldcoin's iris-scanning "Orbs" started to collect biometric data one year ago, only nine are still operational.

The Great Challenge Of European Regulation

In the European Union, the future of the proof-of-personhood crypto project founded by OpenAI CEO Sam Altman and Alex Belania is hanging by a thread.

In the coming weeks, the data protection authority of Bavaria (BayLDA) in Germany is expected to conclude an investigation into the identity protocol. If the probe, which started when the project was still in the testing phase, establishes that the Worldcoin data collection process violates the EU's data protection law (GDPR), it can make Worldcoin iris-scanning illegal in all 27 member states of the block.

Mostly forced, but at times voluntarily, TFH has discontinued operations in all EU countries where it launched except Germany. If Worldcoin is acting outside current EU laws, the temporary setbacks it has been facing might become more permanent. Becoming dutiful is a difficult task—blockchain projects run on smart contracts that are immutable by design.

Despite Worldcoin's publicly stated intentions of developing tools that can serve "all of humanity," multiple reports have shown that the primary reason people in developing countries allow their biometrical data to be collected by TFH's "Orbs" is to access the WLD tokens voucher granted by the network to new sign-ups—not to onboard crypto or interact with dApps.

Given that the soon-to-be-launched Worldchain value proposition is the ability to distinguish between Worldcoin-verified humans and non-verified users and prioritize transactions of the former over those of the latter, losing the EU market will seriously hinder the L2 chain's growth.

A Wave Of New Hires

Going for the best but expecting the worst, TFH recently hired a handful of tech industry veterans to tighten all the loose ends national regulatory agencies have a problem with.

Former X employee Damien Kieran was hired as Chief Privacy Officer; Adrian Ludwig, the previous Android security director at Google, joined the project in the capacity of Chief Information Security Officer; Ajay Patel, who worked before as the team leader at the Google Payments identity unity, is the new head of the WorldID; and Rich Helen is now joining TFH as Chief Device Officer, after having had multiple executive roles in Apple, Meta, and Tesla.

Elliott Suthers, who oversaw Coinbase's journey into a publicly traded company as head of corporate communications for the crypto exchange, will handle the European Union situation in his new role as head of communication operations for Europe, the Middle East, and Africa.