Grayscale has filed a registration statement with the U.S. Securities and Exchange Commission to launch the Grayscale Worldcoin ETF. According to the document, the fund would directly hold WLD, the native token of the World Network.
According to the SEC filing, Grayscale plans to follow a passive investment strategy. The value of the fund’s shares would be designed to reflect the price of the WLD tokens it holds, less expenses and other liabilities. A dedicated price index would be used for valuation.
If approved, the ETF would trade on the Nasdaq Stock Market under its standard listing rules. The Bank of New York Mellon would serve as the fund’s transfer agent, while BitGo Bank & Trust would act as the crypto custodian.
What is Worldcoin?
Worldcoin, later rebranded as World, was co-founded by OpenAI CEO Sam Altman. The company develops technologies at the intersection of biometric identification, blockchain and cryptocurrency.
One of the project’s key products is a decentralized digital passport designed to verify that a user is a real person. To confirm identity, World uses spherical devices known as Orbs, which scan the iris of the eye.
The Worldcoin ETF filing is the latest step in Grayscale’s effort to expand its lineup of crypto investment products. The company previously converted its flagship Bitcoin trust into an ETF after winning a landmark legal battle against the SEC.
Grayscale has also launched exchange-traded funds linked to Ethereum and filed for products tied to other cryptocurrencies, including Dogecoin, Solana and Chainlink.
Reputational concerns
Worldcoin has repeatedly faced controversy over its collection of biometric data. To obtain a World ID digital credential, users must undergo verification with an Orb device, which scans the iris rather than the retina, as is often incorrectly reported. Critics warn that a leak of such data could have more serious consequences than a compromised password because biometric characteristics cannot simply be changed.
The practice of rewarding users with WLD tokens for completing verification has also raised concerns. Financial incentives may encourage people to hand over sensitive data without fully understanding the potential risks.
Worldcoin’s activities have faced resistance from authorities in several countries. Spain temporarily banned the project from collecting data following complaints involving, among other issues, the processing of minors’ information and difficulties in withdrawing consent. Kenya suspended user registrations, and a court later ordered the deletion of biometric data collected in the country. Regulators in Germany, Hong Kong, Brazil and other jurisdictions have also raised objections.
World representatives maintain that the technology was designed with privacy in mind. However, the investigations and restrictions suggest that governments are not yet prepared to fully trust a private company with the creation of a global biometric identification database.
Worldcoin previously rose following reports of investment from Eightco.
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