Vitalik Buterin Reveals 4 Big Risk About Worldcoin

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Vitalik Buterin reveals four big risks associated with Worldcoin; Binance CEO tries to prevent CFTC lawsuit; Vladimir Putin signs digital ruble law

Ethereum co-founder Vitalik Buterin talked about Worldcoin, the project of OpenAI CEO Sam Altman.

Buterin discussed the potential dangers of Wordcoin’s authentication solution with its iris-scanning method.

Buterin cited privacy, accessibility, centralization and security issues among the major risks associated with Worldcoin’s proof-of-personhood (PoP). He proposed an alternative solution to overcome these problems.

PoP is a system used to authenticate users without the need for a central authority or the need to disclose personal information.

Buterin proposes a solution

Buterin said that since Worldcoin includes iris scanning, this could raise privacy concerns. According to him, misuse or leaking of such information stands out as an inherent risk:

“At the very least, if someone scans your iris, they can check the database to determine if they have a World ID. Potentially, these scans can reveal more information.”

Buterin pointed out that the Orbs are few in number, which could undermine the project’s accessibility. The Ethereum developer stressed the need to create a sufficient amount of Orbs.

Another risk Buterin pointed out was centralization. Buterin stated that the integrity of Worldcoin’s Orb hardware structure cannot be verified, which will cause problems. According to him, the centralization of the software layer does not prevent the Worldcoin Foundation from creating fake identities.

Buterin, who appreciated Worldcoin’s PoP system, emphasized that further progress should be made.

“The concept of proof-of-personhood seems to be very valuable in principle. While there are risks to this implementation, there are risks to not having it as well. It seems likely that a world without PoP would be one in which centralized identity solutions, money dominate small closed communities, or a combination of all.”

Binance CEO tries to prevent CFTC lawsuit

Binance and its CEO, Changpeng Zhao, are preparing to petition the court for the U.S. Commodity Futures Trading Commission to dismiss a lawsuit filed by the party.

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In a filing with the Illinois District Court yesterday, multiple Binance entities, Zhao and former Chief Compliance Officer Samuel Lim, said they plan to file two separate petitions to dismiss the complaint before July 27.

The petition states that foreign Binance entities and Zhao are preparing to submit a joint motion to dismiss the complaint.

It is stated that Binance has also requested permission to exceed a 15-page limit in the abstract that will be used to support its proposal. The exchange requested that the summary be up to 50 pages, citing the complexity of the Commodity Futures Trading Commission (CFTC) lawsuit filed against it in March.

As it is known, the CFTC filed a lawsuit in March, alleging that the exchange was not properly registered with the regulator.

An excerpt from Binance's application requesting the 15-page limit be increased. Source: CourtListener

The CFTC alleges that Binance has knowingly transacted multiple cryptocurrencies for US residents since at least 2019, deliberately violating US law, despite blocking US citizens from trading on its platform.

The regulator also described Binance’s compliance process as fraudulent, claiming that it willingly conducts its operations outside the US and hides its headquarters in order to evade US regulation.

Vladimir Putin signs digital ruble law

President Vladimir Putin signed the digital ruble bill as of July 24, according to an official document released by the Russian Government.

With Putin’s approval, the digital ruble law is scheduled to come into effect on August 1, 2023. However, all the rules are ready to be implemented, except for one rule.

Article 3, which includes amendments to various Russian federal laws, including those related to bankruptcy and inheritance, is expected to come into force from August next year.

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The new legislation also authorizes the Bank of Russia to launch the first CBDC pilot with real consumers in August. Previously, the government planned to launch trials in April in collaboration with 13 local banks, including giant banks such as Sberbank.

According to the newly signed law, the Central Bank of Russia will be the main operator of the digital ruble infrastructure. Responsibility for all stored assets will be held by the central bank.

Latest developments in the digital ruble bill. Source: Russia's legislative activity system
Latest developments in the digital ruble bill. Source: Russia's legislative activity system

According to Olga Skorobogatova, Deputy Governor of the Central Bank of Russia, the government does not expect mass adoption of the digital ruble in Russia before 2025 or even 2027.

On the other hand, the bill was first approved by the Federation Council on 19 July. According to official records, the digital ruble bill was first registered in December 2022.

While rapid progress was made in CBDC legislation, Russian lawmakers continued to delay the introduction of cryptocurrency regulation after a series of past delays.

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