The UBI idea behind Worldcoin cannot change the world

Author: Golden Financial Reporter Jessy

Preface

Behind the explosion of Worldcoin is a practice of UBI thought in the field of blockchain. This political and economic concept originated in the 1980s and has been practiced many times in real events. It aims to allow all people to have an unconditional basic income: without reviewing any conditions and qualifications, the government or organization regularly distributes money sufficient to meet basic living conditions for all members (people) regardless of their income, work or property.

This is a relatively left political and economic trend of thought, but it is relatively moderate compared with egalitarianism. The UBI practice on the blockchain has also been practiced by projects before Worldcoin, and it has also led the trend, but it is now silent.

DIFFERENT EXPERIMENTAL RESULTS OF UBI IDEAS IN INDIA AND FINLAND

UBI emerged in Europe in the 1980s, but its source of thought can be traced back to the earlier Middle Ages. Compared with the "conditional" social welfare linked to the income level, it advocates that the state provide an "unconditional" basic income for fairness - regardless of rich or poor, age, health or not, all citizens enjoy the same amount of basic income. It differs from the minimum wage in that you don't have to work to earn it.

This concept has already been practiced on a small scale in some countries and regions. For example, in India, with the support of UNICEF, an 18-month poverty alleviation plan was launched in 9 villages in northern Madhya Pradesh in 2011. The Women’s Employment Mutual Aid Organization and the United Nations Welfare Agency jointly distributed basic rupee subsidies to local people. According to the comparison of the experimental control group and the later evaluation of SEWA & UNCEF, about 21% of households who accepted UBI increased their production and business activities, while the proportion of households that did not accept UBI was only 9%. The evidence also shows that households that accepted UBI significantly increased labor supply, that is, the experiment did not find that UBI has a negative incentive for employment. Banerjee et al gave a preliminary explanation for the above results from the perspective of the absence or imperfection of the insurance credit market that is common in developing countries, and believed that UBI can help the poor get rid of the plight caused by the lack of market, thus offsetting the negative labor incentives brought about by the income effect of UBI. In addition, studies have shown that UBI can increase the proportion of children attending school, reduce the number of child laborers, improve the relative status of women in family production and life, improve family financial status, and increase the participation of poor people in government projects.

In the UBI experiment conducted by Finland, a developed country, the effect is not as good as that of India. As we all know, Finland is a country with high taxation and high welfare. Unemployment benefits plus various social subsidies are even higher than Finland’s per capita income, so Finland’s unemployment rate has remained high. From 2017 to 2018, the Finnish government conducted a two-year UBI experiment, hoping to find an alternative to the existing social welfare system. At that time, this experiment was carried out nationwide. At that time, the Finnish government only used UBI as a supplement to the existing social welfare system, and only randomly selected 2,000 unemployed people aged 25 to 58 from across the country as UBI beneficiaries, and about 170,000 unemployed people were used as controls. The biggest difference from receiving unemployment benefits is that the money will not be canceled just because you are employed. However, the experimental results show that there is no significant behavioral impact on the unemployed who participated in the UBI experiment. The working hours of these 2000 were no different from those of the control unemployed group. The results of the experiment seem to suggest that, in a place like Finland, where existing policies are already generous enough, UBI will struggle to have a significant impact on the jobs and motivations of potential workers. Moreover, if the real full name of UBI is promoted, major adjustments must be made to the existing tax system, and tax increases will definitely be unavoidable.

Supporting the idea of UBI is considered to be able to achieve the following goals: first, to eliminate the poverty that still prevails in many developing countries; second, to alleviate the impact of technological change on the job market; and third, to adjust income distribution to achieve common prosperity.

This concept is somewhat similar to moderate egalitarianism, but it only gives people a basic income to ensure their survival.

The concept of UBI has also met some opposition. It is not difficult to see that this will actually cause huge costs to the economy. If other expenditures are not cut, then to realize the nationwide development of this concept, taxation must be increased.

In the examples of India and Finland mentioned above, it is not difficult to see that this system is more useful for the "poor" people who are more restricted by money, but for those who have already met their survival needs, the money will not bring much change to their lives. Therefore, the proposal of this concept, in the view of Golden Finance reporters, is actually a kind of "lazy" behavior that does not think about specific solutions to specific social problems.

The practice of UBI concept other than Worldcoin in the blockchain

With the development of technology, especially with the development of technology, it is more and more likely that most people will lose their jobs due to the development of technology. The concept of UBI has exploded again. Some people believe that after such a basic income is distributed to everyone, it can give most of the unemployed a buffer period to update their skills and adapt to the changes in work brought about by new technologies.

In addition to Worldcoin, there are the following. UBI is not a new thing in the practice of blockchain.

CirclesUBI

Officially launched in 2020, it has been developed for 7 years under the leadership of Gnosis founder Martin Köppelmann. . According to the white paper, CirclesUBI is based on personalized encrypted tokens and the trust social graph built between these tokens. The purpose of this currency system is to distribute currency in a fair way, and as time goes by, it will eventually achieve equalization of wealth, and it will be like a "universal basic income" available globally

Circle's promotion system is very smart and down-to-earth, and it uses a method similar to the Pi project to keep the communication sticky.

To put it simply, users need to invite 3 people to grant credit, and then they can create their own Circles. In this circle, users can mint a personal Circles token. Interestingly, the tokens of different users can trust each other, and their tokens can be interoperable. And behind this interoperability is the overlap of social networks and attempts to shape a new global currency system

Everyone needs 3 people to help activate, and in order to build their own network and make their coins more valuable, more people will trust each other.

However, the problem with this project is that according to the rules, each person can create multiple personal accounts through multiple devices and emails, thereby minting more Circles token rewards, which actually conflicts with the concept of UBI.

ENUMIVO

The project was launched in early 2018 and is called Avocado in the Chinese community. The project develops a UBI dApp to provide everyone with a regular income in the form of UBI tokens. The technology used in this application-a dedicated oracle verification system is running on the Enumivo blockchain system. The Enumvio blockchain system completely replicates the EOS blockchain system developed by Block.One. At the same time, it provides an affordable alternative for developers who want to take advantage of the advantages of EOS blockchain technology. The founder's ideal is to be a poor man's version of EOS.

A total of 500 million tokens of ENU, 400 million are airdropped, and users only need to send 0 ETH to an address to receive ENU. The first user can get 4,000 ENU, and after each airdrop, the number of ENU received by the user will decrease by 0.001%.

The project was launched at the time of the EOS fire, so ENU, known as the cloned version of EOS, also received high attention. It was also known as "the first airdrop coin in the currency circle", and in August 2019, the official website of Enumivo (ENU) showed, "Enumivo is dead, sell your ENU, but never buy it. The whole project has been controlled by some people. They want to manipulate the currency price." At the same time, Aiden Pearce, the founder of Enumivo (ENU), has also canceled his Telegram account and left the project.

The crisis of ENU emerges. According to media reports, the direct reason for the founder’s departure was that one node controlled 6 of the 21 super nodes, as well as the backup nodes.

In fact, in this project based on the UBI concept, more than 95% of the chips are highly concentrated. In addition to the initial airdrop, with the operation and development of the project, ENUMIVO has increasingly deviated from the concept of UBI, which may be the main reason for the idealism of the founder to leave.

Humanity DAO

Launching in 2019, it is an experiment in unique identity, governance and universal basic income. It is open to all. People who sign up for Humanity get a UBI of $1 per month (until the Dai supply ends). The top 10,000 will also receive Humanity voting tokens, access to smart contracts that refer to this registry to fight Sybil.

It is deployed on the Ethereum mainnet, and its original intention is that there is no standard for defining "unique identity" in Ethereum, and it wants to confirm everyone's identity in this way, so as to avoid Sybil attacks.

Summarize

Comparing the above-mentioned three blockchain projects that apply the UBI concept, it can be seen that the application of the UBI concept of Worldcoin seems to be more in line with the needs of people for the UBI concept under the development of technology. The development of AI technology has made people full of fear that the development of AI will make a large number of people unemployed, and Worldcoin's behavior of "distributing money" to everyone seems to relieve people's anxiety under the panic of the technological revolution. Moreover, when worldcoin confirms the identity of each person, it adopts the red membrane scanning verification method, which seems to be able to distinguish not only everyone, but also humans and robots, and it seems to be able to solve the problem when Ai develops to a certain stage in the future.

However, when we compare the various UBI practices practiced in reality, we can see that the funds for these projects all come from the government and organizations, and the money of the government and organizations also comes from the redistribution of wealth created by society, but where does the "money" in Worldcoin come from? Is it still a succession from later generations? The Jinse Finance reporter believes that it is too early to implement the UBI concept in blockchain projects.