Author: LianGuai journalist Jessy
Recently, Allen, who used to find black people in Kenya to do Worldcoin KYC and then resell the accounts to domestic users, has returned to China. The source behind the products that users on Xianyu encountered that can pass Worldcoin is such a third party like Allen in Africa.
But now this business is not doing well. Worldcoin is officially launched, and the coin price is transparent, eliminating the gray space. In addition, the political situation in Kenya is unstable recently, so he suspended the business of doing KYC and returned to China.
This business lasted for more than three months. At its peak, he could earn 20,000 yuan in a day at a local point where iris verification could be done. But the most profitable days only lasted for two weeks, which was in May when Worldcoin was most popular in China. At that time, the growth of new local users exceeded normal expectations, and soon the operators discovered something fishy.
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Below is Allen’s account:
This business became difficult to do later on. Before I returned to China, one of our employees was caught by the local police and had to pay nearly 250 yuan to be released (the minimum wage in the local area is about 900 yuan per month). The police arrested people using charges similar to “disrupting public order” in China.
What we did was to act as intermediaries for KYC, and we did it for about three months. I have a full-time job in Kenya, so this business is just a part-time job for me. This business is not difficult. We found local promotion points set up by the local operators, and the local employees I hired took the hired migrant workers to verify iris KYC. Initially, the salary for these migrant workers was 1 USD, but later, as the competition intensified with more teams doing third-party verification KYC, their wages increased to 3 USD.
99% of the people involved in this matter were Chinese people behind the scenes. The competition was fierce. Later, when local Chinese people saw that there was money to be made, they all started doing this. On the one hand, the wages of migrant workers increased, and on the other hand, the headhunting fees for local employees also increased. In the early days, the cost of creating an account was about 6 to 7 USD, but later it increased to 9 to 12 USD.
The later increase in fees mainly came from paying the store staff. They would find it strange that I would bring several people to complete the scan and then bring several more people, so I had to give them tips for them to let me continue.
The peak of Worldcoin in China was in early June. At that time, we would find about 100 people to go to each operation point for verification every day. However, such days did not last long. After more than a week, the local operators found something wrong. The promotion model of Worldcoin is that one operator manages a large region, and a country is divided into five or six large regions, each of which has a dozen or twenty stores. Approximately every two to three stores are monopolized by a Chinese third party like me. Regional operators found that the data of some stores was much higher than that of other stores. When they investigated, they found out where the problem was. In order to regulate this “gray industry,” the verification business in Kenya was temporarily suspended for a week. I estimate that there were about a dozen Chinese teams doing this. So there were thousands of fake users every day.
The general public in Kenya has limited knowledge of Web3, and Worldcoin’s promotion in Kenya has also been poorly done. Before getting involved in this business, I once passed by a verification point where they could scan irises. That point was similar to a shed set up for community activities in residential areas in China. At that time, I didn’t realize what they were doing. It was only after I saw related content on Twitter after returning home that I understood that it was a Worldcoin promotion point.
If it weren’t for us third parties finding people to register, the actual number of registrations at a local store would be around ten per day. I observed this data: approximately one real user would come to the site for verification registration every hour. The main reasons for the low number of real users are as follows: first, the local infrastructure is very poor, and the phones used by the locals are not like the smartphones we use in China. The operation of Web3 applications has higher requirements for phones and internet speed. Second, the locals have little awareness of Web3. For example, the migrant workers we hire would not accept settlement rewards in cryptocurrency. We pay them in local currency.
Based on this, Kenya, including most parts of Africa, is not a suitable place for promoting Web3 applications through ground promotion. Previously, I also helped Debox with promotions in the local area. They contacted Chinese people from various places to be their brand ambassadors, but the effect was only average. Living in the local area, I basically haven’t seen any other Web3 projects doing large-scale promotion. The locals are more cautious, and if your project becomes big, the local government will want a share of it.
When we do this, we have to consider the input-output ratio and also the trend. Worldcoin should have started promoting in Africa around October last year, but at that time, the project had no heat. It was not profitable to get involved during that period. It was only when OpenAI became popular in China this year that people started paying attention to this project again. This business opportunity was completely discovered by Chinese people in May and June.
Do the math. Assuming the cost is $6, selling one account for $40, and one ground promotion point has a hundred people, that’s twenty thousand dollars. At that time, we hired a general manager who led five small teams. These five teams would go to various points every day, and one point could handle 80 to 100 accounts.
In the early stages, the project party would also tacitly approve of our behavior of finding people to do KYC on their behalf. After all, user growth and good data are important for Web3 projects to attract investors and secure funding. However, in the later stages, the project party will definitely distance themselves from this behavior and no longer allow so many fake users. In fact, this announcement about the project going live at the end of June is to signal this. In these African countries, including Kenya, the data is rising too strangely. Moreover, Worldcoin itself emphasizes real KYC, with each person having only one iris.
There is a saying online that our behavior and Worldcoin’s promotion in Africa is a form of new colonialism in Web3. I would think that people who say such things are “unable to eat meat”. One or two dollars is the cost of several meals for the locals.
What Worldcoin is doing is indeed giving money to people in these third world countries. I think from this perspective, this project is quite great. However, there is still a lot to be done if the project wants to go far.
I work in Africa and have some observations about the local Web3 ecosystem. I think a lightweight wallet is a suitable Web3 project to promote here. Being lightweight can adapt to the local infrastructure level, and a wallet may meet the needs of local people. For some African countries, their local currency exchange rates are very unstable, and holding a certain amount of mainstream virtual currency can hedge risks. This wallet can cooperate with the government in the promotion process and provide certain commissions to local users, which should yield good results.
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