Hype Archives - ETH Universe

A close-up of an eye iris scanned into a biometric Orb for the proof of humanity to get access the WorldCoin digital asset.

Orb Envisions a New WorldCoin Asset

August 7, 2023

WorldCoin's Orb – a beacon of identity verification, heralding a new age of accessible cryptocurrency by Melvin Hoyk.

WorldCoin is a project that aims to create a global identity and financial network that is owned by everyone. It consists of a digital currency called WLD and a digital identity called World ID. To get a World ID, users need to visit an Orb, which is a biometric verification device that scans their iris and verifies their humanness and uniqueness. The Orb then deletes the image and generates a zero-knowledge proof that the user is a real person. The user can then claim a share of WLD tokens for free, as well as use their World ID to prove their identity online without revealing any personal information. WorldCoin claims that this system can increase economic opportunity, enable global democratic processes, and potentially pave the way for AI-funded universal basic income (UBI). In this article, we will explore the benefits and challenges of using iris scanning and zero-knowledge proofs for identity verification and financial inclusion, as well as the potential risks and limitations of WorldCoin.

The Benefits of Iris Scanning and Zero-Knowledge Proofs

One of the main advantages of using iris scanning for identity verification is that it is highly accurate and secure. The iris is a unique feature of the human eye that does not change over time, unlike fingerprints or facial features. It is also difficult to forge or spoof, as it requires a high-resolution image and a live scan. Moreover, iris scanning does not require physical contact with the device, which reduces the risk of contamination or damage.

Another benefit of using iris scanning is that it can be combined with zero-knowledge proofs (ZKPs), which are cryptographic techniques that allow one party to prove something to another party without revealing any information other than the fact that the statement is true. For example, Alice can prove to Bob that she knows a secret password without telling him what it is. ZKPs can be used to create digital identities that are anonymous, verifiable, and unlinkable. This means that users can prove their identity without disclosing any personal information, such as their name, address, or date of birth. They can also use different identities for different purposes, such as voting, banking, or social media, without linking them. This enhances the privacy and security of the users, as well as their control over their own data.

How WorldCoin Works in Practice

WorldCoin works by distributing WLD tokens to anyone who creates a World ID using an Orb device. The Orb device is a spherical metal object that contains a camera and a screen. It scans the user’s iris and generates a ZKP that proves that the user is a unique and real person. The ZKP is then sent to the WorldCoin network, which verifies it and allocates a share of WLD tokens to the user’s wallet. The user can then use their WLD tokens to access various services and platforms that accept them as a form of payment or reward. The user can also use their World ID to prove their identity online without revealing any personal information.

WorldCoin launched its beta program in July 2023, after raising $25 million from investors such as Andreessen Horowitz, Coinbase Ventures, Reid Hoffman, Naval Ravikant, and Sam Altman (OpenAI). The beta program involved more than 2 million users from 20 countries who each received 25 WLD tokens. WorldCoin plans to distribute 10 billion WLD tokens over the next 10 years, with 70% going to users, 20% going to developers and partners, and 10% going to the team and investors. WorldCoin also aims to deploy thousands of Orb devices worldwide, especially in developing regions where access to digital identity and financial services is limited or nonexistent.

The Potential Risks and Limitations of WorldCoin

While WorldCoin has an ambitious vision and an innovative technology, it also faces some challenges and criticisms. One of the main concerns is the privacy and security of the user’s biometric data. Although WorldCoin claims that the Orb device deletes the iris image after generating the ZKP, some experts doubt whether this process is truly secure and irreversible. Moreover, some users may be reluctant to share their iris scan with a third-party device that they do not fully trust or understand. There is also a risk of coercion or fraud, where someone may force or trick another person into scanning their iris for malicious purposes.

Another challenge for WorldCoin is scalability and adoption. While WorldCoin has distributed millions of WLD tokens to its beta users, it still needs to convince more people and platforms to use them as valuable currency or utility tokens. WorldCoin also needs to ensure that its network can handle increasing transactions and users without compromising its speed, security, or decentralization. Furthermore, WorldCoin needs to comply with the legal and regulatory frameworks of different jurisdictions, which may vary in their recognition and treatment of digital identities and cryptocurrencies.

One of the recent issues that WorldCoin faced was an alleged Sybil attack, which is a type of attack on a computer network service in which an attacker subverts the service’s reputation system by creating a large number of pseudonymous identities and using them to gain a disproportionately large influence. According to Trusta, a platform that analyzes on-chain data, 130 clusters of fake identities manipulated 20 or more WLD tokens each, by using biometric verification to create multiple Gnosis Safe wallets and claim WLD tokens for free, then transferring them to other addresses for profit. This suggests that WorldCoin’s identity verification system may not be as secure or reliable as it claims to be and that its distribution of WLD tokens may not be fair or equitable.

Another tweet from Eric Wall questioned the economic control of the keys linked to the iris scans of the users, implying that the users do not have full ownership or access to their World IDs or WLD tokens and that they may be vulnerable to fraud or manipulation. This raises doubts about the decentralization and sovereignty of WorldCoin, and whether it truly empowers its users or exploits them.

Conclusion

WorldCoin is a project that aims to create a global identity and financial network that is owned by everyone. It uses iris scanning and zero-knowledge proofs to verify the humanness and uniqueness of its users and distributes free WLD tokens to them. WorldCoin claims that this system can increase economic opportunity, enable global democratic processes, and potentially pave the way for AI-funded universal basic income. However, WorldCoin also faces some challenges and criticisms, such as privacy, security, scalability, adoption, and regulation. WorldCoin is not the only project that uses biometrics and blockchain for identity verification and financial inclusion, as there are other similar projects or solutions that have different approaches and goals. WorldCoin is an interesting and innovative experiment that may have a significant impact on the future of digital identity and finance.

Will I give WLD a try? I’m in Malaysia now, and the nearest countries that provide Orb are Singapore and Hong Kong. With the sign-up using Orb, you will get 25 WLD tokens for free, which are worth $2.45 USD each, or around $61.25 USD in total. With that amount, I will just be a spectator for now. I wouldn’t spend money on flight and accommodation expenses just to get that $61.

You can find more information about WorldCoin and its Orb here:

https://worldcoin.org/
Understanding the Orb and why WorldCoin uses biometrics
Opening the Orb: A look inside WorldCoin’s biometric imaging device

A huge bitcoin emerge from the financial building area. People were staring at it.

The Global Embrace of Digital Assets

July 14, 2023

BlackRock and Hong Kong Set the Course for Future Innovation by Melvin Hoyk.

The ascent of digital assets like cryptocurrencies, tokens, and blockchain-based platforms is unmistakable within the world’s financial system. Despite challenges such as price volatility, security, and regulatory compliance, the allure of digital assets remains strong, offering the benefits of innovation, inclusivity, efficiency, and transparency.

The international stance towards digital assets varies greatly, with some countries welcoming the potential of these digital innovations, while others remain apprehensive. This article explores the advancing wave of digital assets through the lens of two pivotal developments: BlackRock’s proposal for a Bitcoin ETF in the U.S. and Hong Kong’s urge for major banks to embrace digital assets.

Inside BlackRock’s Bitcoin ETF Journey

As the world’s largest asset management firm, BlackRock supervises over $9 trillion in assets (as of December 31, 2022). With nearly $4 trillion in assets under management, its iShares portfolio is the biggest U.S. family of ETFs. The financial titan is now venturing into the crypto arena, viewing digital assets as a promising asset class.

On June 15, 2023, BlackRock requested SEC approval for a spot Bitcoin ETF. This ETF would reflect the current Bitcoin price, providing investors with a more straightforward, affordable way to invest in Bitcoin. Yet, the SEC hasn’t green-lighted any spot Bitcoin ETFs in the U.S., citing concerns around market manipulation and investor protection.

BlackRock’s move, despite uncertainty, fuels optimism among financial firms and crypto supporters, hopeful that a spot Bitcoin ETF will soon get a nod in the U.S.

Unpacking the Bitcoin ETF: You Own the Fund, Not Bitcoin

A Bitcoin ETF, or exchange-traded fund, is a type of investment fund that shadows the price of Bitcoin, the world’s leading cryptocurrency. This form of investment permits individuals to trade shares on conventional exchanges like the NYSE or Nasdaq. Importantly, investors don’t directly deal with the complexities and risks of owning Bitcoin themselves.

When you invest in a Bitcoin ETF, you’re essentially purchasing shares in a fund, not the actual Bitcoin. The responsibility of handling the buying and selling of futures contracts, covering associated fees, and dealing with potential risk falls on the fund manager. This way, investors can gain exposure to the Bitcoin market without the need to buy and store the cryptocurrency themselves.

While investing in a Bitcoin ETF offers a simplified entry into the Bitcoin market, it isn’t without its drawbacks. These include management fees and the necessary trust in the fund manager’s ability to accurately track Bitcoin’s price. Moreover, as investors, it’s important to remember that although you’re investing in a fund that tracks Bitcoin’s value, you don’t have control over any actual Bitcoin assets, nor can you use your fund shares for transactions or transfers that would typically be possible with actual Bitcoin.

Hong Kong’s Initiative Towards Crypto Integration

Hong Kong has adopted a distinct legal and regulatory framework for cryptocurrencies, differing from mainland China. The Hong Kong Monetary Authority (HKMA) aims to establish a new regulatory environment for crypto assets by July 2023, focusing on three key areas: stablecoins for payments, investor protection, and the interface of Authorized Institutions (AIs) with crypto assets.

Despite the bank’s apprehensions, the HKMA is pressuring HSBC, Standard Chartered, and Bank of China to take on crypto exchanges as clients to boost innovation and financial inclusion. However, this effort encounters resistance due to concerns about regulatory uncertainty, reputational risk, and operational challenges.

In Conclusion

The push for a Bitcoin ETF by BlackRock and Hong Kong’s drive for bank adoption of digital assets showcases how digital assets are increasingly gaining acceptance. These significant moves could influence the global adoption and regulation of digital assets. As the crypto industry continues to mature, such developments offer potential opportunities for investors, businesses, and regulators, alongside accompanying challenges and uncertainties.

BlackRock’s entrance into the crypto realm, though met with different opinions, signifies a monumental step for the industry. However, prospective investors should always conduct thorough research before investing in digital assets and not let FOMO lead to unwarranted risks. After all, while digital assets offer enticing opportunities, they are not without risks. As with any investment, it’s essential to only invest what you can afford to lose.

Bag of HYPE, Second part of the Meme Coin, PePe Coin takes over. Cryptocurrency shitcoin.

The Wild Ride of Pepe Coin

June 4, 2023

Welcome back to the second part of our series on the manic season of meme coins! If you haven’t read Part I, you may want to take a peek there before diving into this piece. In the previous part, we touched on an Ethereum-based meme token that’s been making hot and cold waves in the crypto market. Today, we’re going to delve deeper into the frenzy surrounding this coin, the intricate dance of supply, demand, and market manipulation at play, and the cautionary tale it presents.

Gambling on the Blockchain

Pepe Coin’s story is one of meteoric rise and rollercoaster volatility that embodies the spirit of a casino. It’s a game of high stakes where fortunes can be made or lost in a matter of seconds. Since its launch on April 17, 2023, around 120,000 people traded the coin, catapulting it from zero to a staggering $1.5 billion market cap by May 5, 2023.

The coin had no discernible utilities, yet the market cap accelerated in a span of two weeks. The sudden rise in value might seem tantalizing, but let’s not forget the old adage: “What goes up must come down.” By May 11, the market cap had declined to $677 million. If you had bought Pepe at its peak on May 5, you’d be nursing significant losses.

The Invisible Hand of MEV Bots and Market Manipulation

What propelled this whirlwind journey of Pepe Coin? The answer lies in the world of MEV Bots. An analysis showed that around 122,000 distinct wallets were driven by MEV Bots. One such bot, operated by the user jaredfromsubway.eth, was involved in some serious shenanigans, conducting what’s known as sandwich attacks.

The bot paid an astonishing $34 million in gas fees, with 98.3% of its transactions being sandwich attacks. In this form of attack, the bot places a buy order, waits for others to follow suit (thus driving up the price), and then quickly sells at a profit. It’s a form of front-running that takes advantage of the predictability of human behavior and the transparency of the blockchain.

The Dangers of Jumping on the Bandwagon

The frenzy surrounding meme coins, as exemplified by the rapid rise and fall of Pepe Coin, serves as a stark reminder of the inherent risks of trading these volatile assets. The illusion of easy money, coupled with the fear of missing out (FOMO), can be a compelling reason for traders to “ape” into these tokens, especially when their values appear to be skyrocketing. However, this can lead to substantial losses for those who enter the market late, buying at peak prices only to witness a swift decline soon after.

This pattern of quick buying and selling not only underscores the dangerous allure of meme coin trading but also reveals how it resembles a form of gambling in a grand casino, where the house—in this case, the Miner Extractable Value (MEV) bot operators—almost always wins. When everyone rushes into such assets without considering the potential consequences, they can quickly become super illiquid, leaving late traders, particularly those who have invested large amounts of money, bearing the brunt of the losses. The Pepe Coin saga thus serves as a sobering cautionary tale, highlighting the high-risk nature of meme coin trading and the potential for substantial financial loss when buying in at peak prices.

A Word of Caution

While the world of meme coins can be exciting and potentially profitable, it’s crucial to approach it with caution. The volatile nature of these tokens, combined with the potential for market manipulation, means that they can quickly lose value. It’s easy to get caught up in the hype, but it’s essential to remember that these coins are not a stable or sustainable investment.

Instead of chasing after the latest meme coin trend, consider investing in more long-term, sustainable assets. Look for projects with a solid foundation, a clear vision, and a strong team. These types of investments may not offer the instant gratification of a skyrocketing meme coin, but they’re much more likely to provide stable, long-term returns.

The story of Pepe Coin serves as a cautionary tale in the world of meme coin trading. While the potential profits can be enticing, it’s essential to remember that these are highly speculative investments that come with substantial risk. Approach with caution, do your research and always remember: if something seems too good to be true, it probably is. – written by Melvin Hoyk

Bag of HYPE – The meme coins season had arrived. A giant ship floating on mid air distributing cryptocurrency coins.

Riding the Wave of Meme Coins Manic Season

June 4, 2023

In the dizzying world of cryptocurrencies, there’s never a dull moment. The most recent frenzy? Meme coins. In this article, we’re diving into the tidal wave of these trending tokens, breaking down their meteoric rise and shedding light on the market dynamics fueling this manic season from April to May months.

The Rise of the Meme Coins

In an era dominated by digital trends, cryptocurrencies have found a quirky partner in memes. Meme coins – digital currencies inspired by internet memes – have emerged as the latest sensation in the crypto space. The most recognizable of them all, Dogecoin, originally started as a joke in 2013. Fast forward to today, and this “joke” is one of the top cryptocurrencies by market capitalization, largely thanks to its association with tech mogul Elon Musk and the embrace by a loyal and passionate online community.

Following Dogecoin’s success, a plethora of other meme coins have sprung up. Shiba Inu, SafeMoon, and Elon Musk’s tongue-in-cheek “Marscoin” are just a few examples of tokens that have sparked manic trading seasons, fueled by social media hype and speculator interest.

The Power of the Crowd

The rapid rise of meme coins has shown us the power of collective belief and social media influence in the digital age. Meme coins derive their value not from traditional financial metrics, but from a shared sentiment of value among a community of holders. The popularity of these coins is often driven by influencers, celebrity endorsements, and the “fear of missing out” (FOMO) among retail investors.

This phenomenon is a testament to the power of the internet and social media in shaping market trends. It has democratized the world of investment to an unprecedented extent, allowing anyone with an internet connection to participate in financial markets.

Navigating the Mania

While the rise of meme coins is undoubtedly exciting, it’s important to remember the inherent volatility and risk associated with such investments. The same social media hype that can rapidly inflate the value of these coins can also lead to sharp declines when sentiment shifts.

Moreover, while some investors have made substantial gains during this meme coin mania, others have experienced significant losses. It’s crucial to remember the cardinal rule of investing: never invest more than you can afford to lose.

A Word of Caution: Keep Your Bets Small

As we journey through the roller coaster world of meme coins, it’s crucial to temper our excitement with a healthy dose of caution. These coins, while creating a buzz in the crypto markets and often catching the eye with their skyrocketing values, carry inherent risks that can lead to substantial losses.

Trading in meme coins, or ‘shitcoins’ as they’re often termed, is a high-risk game. The volatility is extreme, and the potential for rapid loss of value is high. These coins often lack fundamental value, and their prices are largely driven by speculative trading and hype. When the hype fades, so does the coin’s value.

It’s worth noting that, despite the allure of potential quick profits, meme coins should not be viewed as a sound or reliable investment strategy. The nature of these coins is highly speculative, and their value can evaporate almost overnight.

For those still intrigued by the world of meme coins, the best advice is to keep your bets small. Only invest what you can afford to lose, and always do your own research. Be aware of the hype, but don’t let it cloud your judgement.

In the grand scheme of things, it’s advisable to consider these meme coins as nothing more than a news muse – a fascinating spectacle to watch from a safe distance. While they may provide an interesting footnote in the history of cryptocurrency, they are far from being a long-term, sustainable investment.

The take-home message here is simple – play it safe. In the volatile world of meme coins, caution is your best ally. Embrace the excitement, and enjoy the spectacle, but always remember that when it comes to your hard-earned money, it’s better to be safe than sorry.

Next: The Wild Ride of Pepe Coin