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(Bloomberg) — Worldcoin — the billion-dollar start-up that aims to give cryptocurrencies to every living human being by imaging their eyes — recently shut down operations in at least seven countries due to a host of logistical hurdles that prevent it. have prompted the launch to redraw plans.

Co-founded in 2020 by former Y Combinator chief Sam Altman, Worldcoin aims to photograph the irises of everyone on Earth to identify them so it can distribute its new digital money fairly. So far, the company has collected images from the eyes of hundreds of thousands of people in about 20 countries. But the process has been complicated by issues such as uneven access to smartphones, confused users, and fraud attempts.

Worldcoin has suspended operations in multiple countries after local contractors left or regulations made doing business impossible. Following technical challenges, it also instituted a new requirement that everyone who signs up must have a smartphone — limiting reach in developing countries, which was key to the company’s vision. Worldcoin has also repeatedly postponed its target launch date, which is now slated to be later this year.

Worldcoin co-founder and Chief Executive Officer Alex Blania said in an interview last week that these setbacks are the natural result of “very aggressive testing” for a fledgling startup. The company has grown from 10 to 100 employees in the past year, Blania said, and it is still experimenting as it tightens its operations. “You’re still talking to a Serie A company, not an Uber,” he said. “Things are not perfect.”

Worldcoin may have only raised one round of institutional funding, but the startup already has the $1 billion valuation and responsibilities of a more established company. The backers are a who’s who list of Silicon Valley, including Andreessen Horowitz, LinkedIn co-founder Reid Hoffman and the venture capital arm of Coinbase Global Inc. Worldcoin is now also the custodian of sensitive biometric data on approximately 450,000 people.

Worldcoin has been criticized by privacy experts who are concerned about a young company using so much personal information. The startup’s departure from some regions has also put contractors on site in a stressful position, according to three of the employees, who asked not to be named because they are not authorized to speak publicly about their jobs. In some countries where Worldcoin has shut down, contractors have had to deal with confused and angry users who fear the crypto startup has scanned their eyes and disappeared, they said. Blania said the company will open source many of its hardware designs and protocol in the coming weeks, a move he says will “allow everyone to verify our commitment to user privacy and security.”

At the heart of Worldcoin’s plans is a shiny, chrome-plated sphere the size of a volleyball. Called the Worldcoin sphere, the device weighs about five pounds, costs about $2,000 to $3,000 to make, and can take a detailed picture of someone’s eyes in seconds. The team started developing the device after Altman came up with the idea in 2019 for a new cryptocurrency that was accessible to everyone in the world. To ensure that no one signed up to Worldcoin more than once, Altman and his co-founder Blania decided to identify people by their irises.

The company secretly started building and distributing the orbs, but Bloomberg released the news in June about the startup’s hardware and plans for eye-imaging. Last fall, Worldcoin said it had already seen 130,000 people in the eye in countries such as Chile, Kenya, Nigeria, Norway, Benin, South Africa, France, Sudan and Indonesia.

The imaging is operationally complex and must be done in person by one of Worldcoin’s contractors, whom they refer to as “Worldcoin distributors” or, more colorfully, “orb operators.” The orb is held up to someone’s face as they stare into the cameras. The act of imaging can make for a disturbing scene: The silver orb speaks in a calm female voice and says, “Scanning. Open your eyes.” Sometimes the machine advises, “Come a little closer.” For the measurement to work properly, the person being scanned must stare at the camera with their eyes wide open for about 10 seconds or more, showing as much of the whites of the eye as possible. Once completed, the registrant can choose to add a small amount of Worldcoin to a digital wallet as a reward for signing up.

Worldcoin’s operators are paid for every person they register, and are often local entrepreneurs interested in the promise of a global currency that can help people, for example, send money to their families abroad without paying intermediaries or transfer fees. Some distributors used their local connections to advocate on behalf of Worldcoin before government officials or authorities wary of crypto. They took the orb to schools and gathering places and also persuaded thousands of people to open their eyes to sign up for a new-fangled project.

Early progress was uneven. The biometric data system was designed to block fraud, but people still tried. Someone tried to scan a chihuahua dog’s eyeballs, Blania said. And there were also technical problems. Initially, distributors signed up people even if they didn’t have their own smartphone or email address, but that turned out to be too complicated. Now Worldcoin only reports users who have smartphones, which in January led to the company shutting down its operations in Zimbabwe and Benin, where mobile phones are less common. “We’ll figure out ways to sign up later, even if you don’t have a smartphone,” Blania said.

Each region has presented unique challenges. In Sudan and Turkey, Worldcoin no longer displays eyes for legal and legal reasons. And in countries like Ghana, France and South Africa, the company has stopped working because the local contractors found the work too demanding, so the bulb was moved to another region for more testing.

Meanwhile, Worldcoin’s launch date has been serially postponed. Last year, the app said it would launch “around the end of summer.” Then it said “around early 2022,” according to screenshots reviewed by Bloomberg. Most recently, the target date was updated to sometime later this year.

Yet Blania’s ambitions for the project are immense. At the moment Worldcoin has about 30 orbs in circulation. The CEO estimated that there would be 6,000 by the end of 2022. And having imaged nearly half a million eyes so far, Blania expects it to have 20 million to 30 million registrants by the end of the year.

It is not uncommon for startups to over-promise and go over deadlines, but Worldcoin’s various delays and withdrawals have left some contractors angry and anxious. They had already fended off inquiries from people who had caught a glimpse and wondered when the currency would finally launch. “You can’t play around with such personal information,” one user wrote to a distributor when he learned that the company had changed its plans. “I’ll come after you if I don’t see any benefits of what you signed us up for.”

Asked about the complaints, Blania said some operators were unhappy that the company would no longer pay them, saying some of them were “doing questionable things or underperforming”. He also noted that the operators may have “very misaligned incentives” with the larger startup.

Early adopters may have some reason to be concerned about privacy: in fact, they are passing on more sensitive data than future users. When pre-launch registrants have their irises photographed, they sign a release form acknowledging that high-quality images of their faces and eyes are stored by the company and used to train the iris-distinguishing algorithm. Going forward, new users’ eye images won’t be saved, but somewhat ironically, the startup has to collect a lot of data to get to that point.

Launching a startup, especially one as mind-bogglingly ambitious as Worldcoin, is an exercise in sophistication and experimentation, Blania said. It’s a common mantra for Silicon Valley entrepreneurs: fail fast, try again. “You test everything,” he said, “different app features, different orb functions, incentive mechanisms, how much you pay an operator.” At the end, if you’re lucky, you get to take your product to anyone on Earth.

This post Crypto Startup Looking to Scan Everyone’s Eyeballs Has Some Problems

was original published at “https://www.bloombergquint.com/markets/worldcoin-the-eyeball-scanning-crypto-unicorn-hits-signup-snags”