Worldcoin Enters the L2 Arena Amidst Regulatory Scrutiny
Despite facing controversies and regulatory scrutiny, Worldcoin, a crypto project co-founded by OpenAI’s Sam Altman, announced the introduction of its layer-2 (L2) solution named World Chain on April 17, 2024.
This move follows Worldcoin reaching 10 million users for its World App wallet a week ago.
World Chain Claims to Prioritize Scalability and Humans
World Chain, built on OP Stack and the Ethereum network, aims to address Web3 scalability challenges. This L2 solution will launch this summer.
Worldcoin claims that the network will be “open to everyone.” Moreover, it also promises that “verified humans, including more than five million verified World ID holders, will get priority blockspace over bots & a gas allowance for casual transactions.”
The network will integrate closely with the Worldcoin protocol to drive growth and utilize World ID’s Proof of Personhood system.
Read more: What Is Worldcoin? A Guide to the Iris-Scanning Crypto Project
Regarding World Chain’s announcement, Alex Blania, CEO of Tools for Humanity (the entity behind Worldcoin), took his excitement to X (formerly Twitter).
“While still early, five million people have already verified with the Orb, and over 10 million accounts have been created. To continue accelerating, Worldcoin will launch a blockchain that can eventually support every human,” Blania said.
World Chain is designed to prioritize scalability, significantly increasing the L2 block gas limit. Worldcoin users’ transactions currently represent about 44% of OP Mainnet’s activity, sometimes exceeding 80% during spikes.
Worldcoin believes a core issue is the prevalence of bots on blockchains. It estimates up to 80% of blockchain transactions are automated.
While many bots serve legitimate purposes, unproductive ones often lead to congested networks and high fees. Ironically, this problem worsens as blockchains optimize for low gas fees and high throughput.
“Bad bots like airdrop farmers worsen many of the problems blockchains face today. People on the World Chain will have the option to anonymously verify their addresses as human with a World ID fully delinked from their ID, simply like a blue checkmark,” Tiago Sada, Head of Product at Worldcoin, explained.
Besides ETH, Worldcoin said that World Chain users can easily pay fees using WLD.
Interestingly, the price performance of Worldcoin’s native token, WLD, was modest after the announcement went live. WLD is trading at $4.83 at the time of writing, representing a 2.39% decrease in the last 24 hours.
Read more: Worldcoin (WLD) Price Prediction 2024/2025/2030
Worldcoin’s decision to launch its own L2 solution comes amidst regulatory scrutiny from around the globe. The Ministry of Production, Science, and Technological Innovation of Buenos Aires province recently issued an indictment against Worldcoin after detecting allegedly abusive clauses in user contracts.
The company could face a fine of up to 1 billion Argentine pesos ($1.2 million). Buenos Aires authorities assert that the company is liable for the penalty.
Besides Buenos Aires, Worldcoin has faced scrutiny from jurisdictions like Spain and Kenya.
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