Worldcoin (WLD) Token Lockup Extension Sparks Controversy, Accusations of Price Manipulation and Insider Trading

The Worldcoin project, known for its eye-scanning identification system, is in the eye of the storm after the organization Tools for Humanity (TFH) decided to extend the lockup schedule for its native tokens.

Worldcoin’s native token (WLD) soared nearly 50% after the organization behind the project shifted the goalposts on the token’s lockup schedule.

Now, a deeper analysis suggests that someone may have used insider information to capitalize on the token’s price movements before the announcement was made.

The Worldcoin project, known for its eye-scanning identification system, has become the center of attention after a decision by the organization Tools for Humanity (TFH) to extend the lockup schedule for its native tokens. Initially, the WLD tokens were set to be unlocked over three years. However, on July 16, TFH announced that the period would be extended to five years, beginning on July 24 and concluding in July 2028.

This change will see 80% of the tokens held by investors and team members being progressively released over the next four years, reducing the number of tokens that will immediately enter the market. The strategy appears to be designed to prevent a sudden drop in the token’s price due to an increase in supply.

After the announcement, the price of the WLD token experienced a rapid increase. According to CoinMarketCap data, the token surged by 49.7%, rising from $1.90 on July 15 to reach $2.96 on July 17. This performance has placed Worldcoin among the best-performing tokens in the market, attracting the attention of both investors and critics.

Among the critics are ZachXBT and the DeFi Squared account on the X platform, who have levied accusations of price manipulation and insider trading against the Worldcoin team. DeFi Squared analyzed the daily price movements of the token and the changes in emissions, market maker contracts, and strategic announcements before unlocks, arguing that the token’s price is being deliberately influenced by the team. The account suggests that it is likely, though not proven, that someone from the team used insider information to benefit before the public announcements were made.

Meanwhile, ZachXBT, a crypto investigator, went further in his criticism, labeling Worldcoin as “the biggest scam of the bull market” and directing harsh criticism at the venture capitalists and team members involved. He expressed outrage that they had not taken any action to prevent these practices.

This controversy highlights the complexities and challenges in managing crypto projects, where strategic decisions can impact market perception and investor confidence. The evolution of this case and the price movements of Worldcoin are worth keeping an eye on.

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