Crypto lending startup Divine Research has issued 30,000 unbacked short-term loans in USDC since December, using Sam Altman’s World ID biometric platform to verify borrower identity and prevent multi-account abuse.
Biometric Verification Meets High-Risk Lending
Operating out of San Francisco, Divine is targeting underserved borrowers globally, offering sub-$1,000 loans in stablecoin USDC without requiring any collateral. Instead, it relies on World ID’s iris scan verification, ensuring each borrower is a unique human and can’t game the system by reapplying under a new identity after defaulting.
“This is microfinance on steroids,” said Divine founder Diego Estevez, adding that the project is aimed at people like “high-school teachers and fruit vendors” who lack access to traditional credit.
40% Default Rate, 20–30% Interest Rates
According to Estevez, the default rate on first loans is around 40%, but interest rates of 20% to 30% help offset the risk. Divine also distributes Worldcoin tokens to borrowers, which are partially clawed back in case of defaults.
Retail Investors Power the Liquidity Pool
Unlike institutional lending desks, Divine’s funding comes from everyday investors seeking yield in high-risk markets. Estevez claims that “after accounting for default rates and interest income, lenders still turn a profit.”
“Anyone can provide liquidity,” he said, positioning Divine as part of a broader retail-friendly DeFi trend.
World ID: A New Gateway to DeFi Credit
Sam Altman’s World ID — originally developed for universal digital identity through iris scans — is becoming a core infrastructure for next-gen uncollateralized crypto lending. It solves one of DeFi’s most difficult problems: identity fraud and Sybil attacks.
Crypto Lending Grows as TradFi Eyes the Sector
Divine joins other high-risk lending startups like 3Jane and Wildcat, both of which are pushing into uncollateralized and undercollateralized lending models. The sector is gaining mainstream traction — JPMorgan reportedly plans to offer Bitcoin-backed loans soon.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.
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