Top Trader Exposes Worldcoin Market Manipulation Ahead Of Insider Unlocks
July 17 2024 - 11:30AM
NEWSBTC
The cryptocurrency Worldcoin (WLD) has seen a dramatic price
increase, surging 75% over the past five days, with a significant
38% increase in the last 24 hours. According to DeFi^2
(@DefiSquared), the number one ranked trader on Bybit and a top 10
wallet on DeBank, this price movement is not merely speculative but
indicative of potential market manipulation, timed with upcoming
insider unlocks. The Worldcoin Cash Grab In a post shared via X,
the top trader DeFi^2 has brought to light concerning details about
Worldcoin’s market activities ahead of its planned insider token
unlocks. With only 2.7% of WLD’s total supply currently in
circulation, the smallest percentage in the industry at unlock
time, the concerns center around how the Worldcoin team has managed
to maintain a staggering $30 billion fully diluted valuation (FDV).
“Worldcoin is projected to commence insider unlocks in 7 days at
one of the lowest floats ever recorded in the industry,” DeFi^2
wrote. “This research piece brings to light exactly how the team is
controlling the price to still carry a $30 billion fully diluted
valuation as insider unlocks begin, while falsely claiming to have
no involvement.” Related Reading: Worldcoin Sentiment Improves, But
March Highs Remain A Distant Dream Worldcoin was initially launched
with a 1.4% circulating supply, or 140 million WLD. Out of this,
100 million tokens were assigned to market makers with call options
that allowed them to buy back a significant number of tokens at a
preset price of slightly over $2. This was strategically aimed at
dampening any sudden price spikes. On “The Scoop Podcast,” Alex
Blania, CEO of Worldcoin, openly discussed these tactics, stating
they were crucial in preventing the price from soaring, which could
potentially disrupt the market. “The intent to avoid the price
spiking to $10,” Blania explained, “is paramount, as such an event
would be horrific for our strategic market positioning.” However,
by December 16th, the situation dramatically shifted when Worldcoin
opted not to renew its market maker contract. This led to the
removal of the call option and a concurrent reduction in WLD’s
circulation by an additional 25 million tokens. The immediate
aftermath saw the price double within hours, a scenario Blania had
previously indicated the company intended to avoid. During the
Token2049 conference in Dubai, Blania reiterated that Worldcoin
does not manipulate market prices, attributing fluctuations to
natural market forces. This statement starkly contradicts the
evident effects of the team’s strategic decisions regarding
tokenomics and market maker contracts. Related Reading: Here’s Why
The Worldcoin (WLD) Price Surged Over 15% In One Day To Reach $3
DeFi^2 emphasizes, “An 11-figure valuation is only possible due to
the team’s deliberate design of tokenomics, and the daily price
movements have often been influenced by well-timed announcements
and policy adjustments made by the team.” Market Manipulation The
Worldcoin framework, which was ostensibly designed to facilitate
universal basic income (UBI), seems to be primarily benefiting
insiders rather than the intended recipients. Current projections
show that nearly a billion tokens are slated for emission to team
members and venture capitalists within the next year, whereas only
about 600 million tokens are expected to be distributed to UBI
recipients in the same timeframe. “This means that within a year,
insider emitted WLD is expected to make up over 60% of the entire
circulating supply of Worldcoin. 60% is a wild proportion- it
basically means the majority of the ecosystem purely exists for VCs
to dump. This seems to directly counter the justification that the
float is being left low right now to benefit UBI recipients,” the
trader writes. Orb Operators, tasked with collecting biometric
data, have also been a significant source of circulating supply,
with some reportedly sending upwards of 20,000 WLD per week to
exchanges like Binance. This situation became particularly
pronounced when WLD’s price spiked to $12 in March, with
substantial quantities of WLD being moved to exchanges every few
days. Retail investors, particularly in Korea, where 25% of the
circulating supply is held, are increasingly vulnerable. Many of
these investors are likely unaware of the intricate dynamics at
play, holding tokens at nearly $30 billion FDV, a valuation propped
up by the positive news released strategically a week before the
unlocks. “It’s likely no coincidence that Worldcoin waited until 1
week before unlocks to release positive news. Despite being only a
small change to unlock selling pressure, the news has proven
incredibly effective so far in coercing retail to unwittingly
provide higher prices and more liquidity for insiders to exit in a
week’s time. Worse still, it appears likely (but not proven) that
someone from the team or VCs used insider information to frontrun
buying the news before it was even publicly announced,”
@DefiSquared claims. He concludes with a stern warning: “This piece
is intended to shed light on a project that appears to be
intentionally propping up a token price that should be lower, and
many of the reasons outlined are why I intend to be short WLD over
the months following the start of unlocks.” At press time, WLD
traded at $3.22. Featured image from Kucoin, chart from
TradingView.com
Maker (COIN:MKRUSD)
Historical Stock Chart
From Jun 2024 to Jul 2024
Maker (COIN:MKRUSD)
Historical Stock Chart
From Jul 2023 to Jul 2024