[Crypto Detectives Reveal Worldcoin Insider Trading Scandal, Token Unlocking]
In a recent exposé, crypto sleuth ZachXBT exposed the Worldcoin team’s questionable behavior leading up to the token’s unlocking. This raises concerns about the integrity of the project and the motives of its backers.
According to research by DefiSquared, the Worldcoin team carefully controls prices to maintain a fully diluted valuation (FDV) of $30 billion while claiming not to engage in price manipulation. Worldcoin launched with a circulating supply of 1.4% (140 million WLD tokens), with 100 million tokens allocated to market makers to buy back large amounts of tokens at just over $2. This strategy is designed to prevent prices from surging too high. However, after the contract was not renewed in December, the price surged to nearly $12.
DefiSquared highlights the discrepancy between Worldcoin’s public statements and actual behavior, questioning its transparency and true intentions of its low-circulation supply. He noted that within a year insider emissions would constitute more than 60% of the circulating supply, benefiting insiders rather than Universal Basic Income (UBI) beneficiaries.
Further scrutiny found that Orb Operators, responsible for collecting biometric data, were sending large amounts of WLD to exchanges such as Binance. One operator was sending nearly $150,000 in WLD to Binance every three days, suggesting insiders were taking advantage of market conditions to liquidate their holdings.
South Korean retail investors hold a large amount of WLD, with nearly 25% of circulating WLD held on Bithumb, a major Korean exchange, as of this writing. These investors may not understand the complexities of token economics and inadvertently prop up the token’s valuation.
The Worldcoin Foundation aggressively sold tokens to the trading desk, causing many holders to lose 70-80% of their value in recent months. DefiSquared pointed to the questionable timing of positive news releases with Worldcoin, with announcements the week before insider unlocks boosting retail interest and liquidity as insiders exited.
ZachXBT criticized the Worldcoin team and investors, saying they profited from "scam tokens." He pointed out that venture capitalists including Nick Tomaino, SBF and 3AC were involved in what he called "the biggest scam coin in the bull market."
