This Week in Coins: Weak Week for Bitcoin and Ethereum—and Worldcoin

The beginning of the week saw the underwhelming launch of Worldcoin Protocol, along with its native cryptocurrency, WLD. 

Worldcoin is co-founded by Open AI CEO Sam Altman and the premise is at once utopian and dystopian: anyone wanting some WLD has to visit an ”Orb”—these can currently be found in Berlin, Dubai, London, Mexico City, Miami, New York City, San Francisco, Seoul, and Tokyo— and get a snapshot of their eyeballs taken. 

This biometric data is used alongside verification of their government-issued ID to confirm someone’s personhood before distributing a set number of coins to them. 

Worldcoin believes it’s building the infrastructure to bank the world’s unbanked, enabling everyone “to broadly share the coming technological prosperity ” says its website. but many are skeptical, including Ethereum creator Vitalik Buterin who listed “major issues” of privacy, accessibility, centralization and security and said it could take years for the protocol to work. 

British privacy watchdog the Information Commissioner’s Office (ICO) agrees, at least on privacy and security concerns and told Decrypt that it “[the organization notes] the launch of Worldcoin in the U.K. and will be making enquiries.”

WLD currently trades for $2.30, about 30% down from its high on launch day of $3.30, according to crypto data aggregator CoinGecko.

The market leaders

It was the fifth consecutive week of underwhelming price performance for market leaders Bitcoin and Ethereum. 

Bitcoin (BTC) lost 1.7% and now starts the weekend at $29,291, while Ethereum (ETH) lost 0.9% and changes hands at $1,872.

The market leaders had a pretty static week overall and their prices haven’t moved much since Monday. This week’s news that the Fed was hiking interest rates yet again did not immediately move the leading coins. 

Last year, the U.S. central bank hiked interest rates by 75 basis points four times and finished the year with a 50 basis point hike. This year there have so far been two hikes—including Wednesday’s—of only 25 basis points each, but interest rates are now the highest they’ve been for 22 years. 

XRP’s recent growth spurt, which was prompted by a small but significant courtroom victory against the SEC a fortnight ago, appears to have settled. Ripple’s cryptocurrency—which is definitely not a security—is down 7.7% for the week and currently trades at $0.70786.

The only other notable price movement this week came from Toncoin (TON), which fell almost 15% this week to trade at $1.24 at the time of writing. 

Crypto politics in Russia, Korea and the U.S.

On Monday, Russian President Vladimir Putin signed into law a bill granting legal tender to a digital ruble, the issuance of which will be overseen by the country’s central bank—although officials say it could take years before the central bank digital currency (CBDC) is widely adopted. 

On Wednesday, South Korea rolled out a new interagency investigation unit to tackle crypto crime and take a leading role in investor protection before regulations are implemented. 

Operating from the Seoul Southern District Prosecutors’ Office, The Joint Investigation Centre for Crypto Crimes will consist of 30 investigators drawn from several government agencies and bodies, including the prosecutor’s office, the Financial Supervisory Service, the National Tax Service, and the Korea Customs Service.

That day, over in the states, Democrats and Republicans locked horns over the Financial Innovation and Technology (FIT) for the 21st Century Act. Rep. Maxine Waters (D-CA), the ranking Democrat on the House Financial Services committee, assailed the bill as a “wish list” for the crypto industry, and said it undermined the role of the SEC and existing legislation. 

Democrats also accused the bill of having weak consumer protections, though this point was parried by Republicans like Committee chairman Patrick McHenry (R-NC), who argued that, while not perfect, the bill is “better at worst case” than the current regulatory regime.  

The Committee members also debated a stablecoin bill called the “Clarity for Payment Stablecoins Act of 2023.” Democrats accuse Republicans of rushing to pass the bill, and Waters said the proposed legislation lacks clarity over the reserves underpinning stablecoins that are pegged to the U.S. dollar.