In a recent exposé, prominent crypto investigator ZachXBT has uncovered potential insider trading and questionable practices within the Worldcoin project as it approaches a significant token unlock. Collaborating with top Bybit trader DefiSquared, the investigation casts doubt on the integrity of Worldcoin and raises serious concerns about its market manipulation tactics.
Insider Trading Allegations
DefiSquared's detailed analysis reveals that Worldcoin plans to initiate insider unlocks with only 2.7% of the total supply currently circulating. Despite claims of minimal involvement in price manipulation, Worldcoin has meticulously controlled its token price to maintain a steady $30 billion fully diluted valuation (FDV). Initially, Worldcoin launched with just 1.4% of its tokens circulating, allocating a substantial portion to market makers. This move aimed to prevent price spikes, a strategy later discontinued by Worldcoin, resulting in a significant price increase to nearly $12.
Discrepancies in Transparency
The investigation highlights significant discrepancies between Worldcoin's public statements and its actions regarding market maker contracts, emission policies, and tokenomics. These discrepancies undermine the project's transparency and raise questions about the true distribution intent behind its limited circulating supply.
Questionable Practices
ZachXBT and DefiSquared also criticize Worldcoin's rationale for a low float, initially justified to prevent unfair distribution for universal basic income (UBI) recipients. However, the analysis suggests that insider emissions will soon constitute over 60% of the circulating supply, benefiting insiders rather than UBI recipients. Suspicious activities, such as large WLD transfers to exchanges during price spikes and the timing of positive news releases, further suggest insider profiteering.
Impact on Investors
The investigation reveals that a significant portion of Worldcoin's circulating supply is held by Korean retail investors on Bithumb, unknowingly supporting the token's valuation. Meanwhile, Worldcoin Foundation's selling of tokens to trading desks has reportedly caused substantial losses for holders. Allegations of complicity extend to venture capitalists like former Coinbase executive Nick Tomaino, FTX founder Sam Bankman-Fried, and 3AC, accused by ZachXBT of enabling what he calls the "biggest scam token of the bull run."
Conclusion
As Worldcoin faces scrutiny over insider trading allegations and transparency issues, the crypto community awaits further developments leading up to the token unlock. ZachXBT's investigation challenges Worldcoin's humanitarian claims amidst accusations of market manipulation and insider profiteering.
JinseFinance
Alex
Catherine
Cointelegraph