a16z Explains the Challenges of Scaling Cryptocurrency Applications through Worldcoin’s Real-World Use Cases
This article is sourced from Christian Catalini and written by a16z, organized and compiled by Rhythm Blockbeats.
(Background: Worldcoin (World Network) is now in Taiwan! Register for World ID by scanning your iris to receive Worldcoin.)
(Background Supplement: Be an adult in the Crypto world: 18 self-responsibility rules)
Just a few weeks ago, Alex Blania, founder of World, presented their latest strategic card in front of a packed audience of cryptocurrency elites. While gaining attention by leveraging policy winds to penetrate the U.S. market was notable, the real stroke of genius was their lightning breakthrough into mainstream consumption scenarios. This marks a shift in cryptocurrency, shedding its “geek club” label and truly entering the battlefield of everyday business.
World’s move is bold: persuading Americans to use iris scans in exchange for a “real person verification badge” is no small feat, even with promises of privacy protection (and the timing may be too early). However, they have quietly laid the groundwork for this ambitious plan over the past three years with three layers of insurance.
First, create genuine product value, then sweeten the deal with tokens. World initially followed an old path: incentivizing user acquisition through tokens. This approach, hailed as “the normalization of Bitcoin’s success,” was later replicated by countless projects, but it actually reversed cause and effect. World encountered pitfalls in early testing — incentives were too aggressive; users did show up, but the privacy community and some developers began to criticize: “This isn’t growth, it’s just a fig leaf for profits.”
However, let’s not forget that Bitcoin has reached where it is today because it offered an unprecedented asset logic from the very beginning: decentralization, a fixed total supply, and independence from central banks. Yes, miner rewards and the myth of skyrocketing prices attracted early speculators, eventually drawing in institutions and nations. But the real builders who stayed were not drawn by “get-rich expectations,” but by its radical potential as a new asset and payment system. Most of the projects that simply copied the playbook are now lining up in the “graveyard” of the crypto world.
The crypto world cannot escape the fundamental laws of economics. Like any entrepreneurial project, the first step is to create a genuinely usable product, then use tokens to resolve cold start or ecosystem incentive issues. Otherwise, no amount of economic modeling will be anything but theoretical. Blania presented three real pain points to substantiate this: social networking, gaming, and credit domains.
In a time when bots are rampant and humans are hard to distinguish, he placed World’s “real person proof” system on the table, clearly explaining: why it’s worth it to scan your iris for a “I am a real person” ticket. In an age where AI is accelerating its invasion into everything, we will eventually face the need for “are you human” verification, and World is merely stepping ahead of the curve.
Learning to Cope with “Infrastructure Inversion”
Back in the early waves of crypto enthusiasm, we all dove in. When I was designing the Bitcoin experiment at MIT, I genuinely believed that within two to three years, we could completely overturn the payment and financial systems. A decade has passed, and we’ve only just begun. To truly push crypto products outside the circle, we must align with the experiences that traditional users and merchants are already accustomed to. This means building a bridge between the old system and new technology. Often, this bridge requires compromises that might seem heretical to “crypto fundamentalists.”
But this phase is unavoidable. You must traverse that awkward period of “new and old coexisting” — Andreas Antonopoulos calls this “infrastructure inversion.” Imagine: dial-up internet occupying telephone lines, the first rickety car clattering down a gravel road; it just doesn’t sound right.
This “technological wall-sitting period” makes it difficult for new systems to be rolled out on a large scale initially; updates can only happen in certain niche scenarios, which cannot be considered a complete system overhaul. The AI field faces similar dilemmas. World initially attempted to skip this phase, directly launching tokens as the main character. But the new version has completely flipped the script: embracing “infrastructure inversion,” returning to product practicality, and advancing more steadily and deeply.
Don’t fantasize about creating a globally universal wallet without integrating with old systems. Depositing and withdrawing must be as smooth as how PayPal made online payments feel natural; otherwise, how can mainstream acceptance be achieved? This is why the new World App integrated Stripe and Visa cards immediately upon launch. Trust, familiarity, and practicality were established in a day. It is because of its willingness to be “backward compatible” that traditional finance has had the opportunity to observe and test waters, rather than being directly eliminated.
This logic is quietly guiding crypto towards cross-border payments behind the scenes. In the future, perhaps technology can enter the mainstream, but before that, it must first “borrow a path” on the old tracks, streamline processes, and minimize friction. Let’s not forget that many crypto mechanisms (including economic models) only have magic when scaled. But to achieve scale, someone must get on board. Without even a ramp to get on board, no perfect model can operate effectively.
The Key to Crypto’s Success Lies in Practical Implementation
Like all new technologies, crypto is not destined to win. Don’t believe the myths propagated by self-congratulatory fans. To be more specific, the foundational pillar of “decentralization,” which is also its most crucial market disruption contribution, has never been a guaranteed matter.
Stablecoins are a good example. To interface with traditional financial systems, the crypto world has birthed such a tool, which is indeed useful. But problems arise along with it: the specter of centralized management and closed networks is once again invited back in.
I tend to believe that open architectures will ultimately prevail, but let’s not forget that those “vested interests” have no reason to make it easy for you to pass through. Blania and his team have made a big bet: that users will care about the decentralized control of their data, and that businesses will build a better user experience on this system. Once decentralized identity disrupts the existing landscape, how challenging it will be — centralized players begin with inherent advantages in UX and functionality.
So if World wants to overtake on a curve, the first step is to convince users to be willing to give up their biometric data. The U.S. market has already started, and we will soon see if they can find a balance between “privacy vs convenience.”
Of course, a gentler “boarding method” might be smarter: for example, first issuing a familiar “verification badge,” which can unlock additional features in your commonly used apps. Don’t rush to have people immediately scan their iris on the sphere. The problem is, doing so makes identity verification less reliable, making it easier to be exploited or bypassed.
Blania’s judgment may not be wrong. In this endless cat-and-mouse game with AI, only military-grade biometrics can truly serve as “unbreakable” proof of a real person. But that doesn’t mean he can’t be gentler; there’s no need to push users hard against the sphere on the first day.
Those looking for airdrops will line up, but the sweet thrill of this wave will last only a few days; once the subsidies stop, the heat will dissipate. Real sustainable growth only exists in the everyday value realization, and this is their true opportunity. If the World App can break through the circle with a payment experience, coupled with globally smooth deposit and withdrawal channels, then it might truly hit a breakthrough.
Conclusion
Looking ahead, they have staked the entire rhythm. What we need to watch next is just one thing: can the crypto world truly penetrate the mainstream market?
Regardless of whether World’s experiment ultimately succeeds, I hope to see more crypto projects willing to shift the spotlight away from “token economics” and “price fluctuations” to genuinely create daily usable products. Because this shift, although not glamorous or lively, is the crucial step that the entire industry must take to enter the mainstream market.
