The Worldcoin global currency project, led by OpenAI CEO Sam Altman, is gearing up for a significant token unlocking. Under equal conditions, an increase in supply will lead to a considerable price drop.
The initial token supply at the project’s launch was 10 billion, but the majority of funds, including all coins for early investors and developers, were locked up. The circulating supply currently stands at only 194 million WLD, or 1.9% of the total issuance. However, over the next 15 years, the remaining coins will be unlocked according to the schedule outlined in the white paper.
Unlocking will commence on July 24th, with 4.75 million WLD released per day. This represents 0.05% of the total token count or 2.4% of the current circulating supply. Thus, the same volume currently in circulation will be unlocked in just 41 days. The degree of negative price impact will depend on holders’ willingness to part with their coins.
Additionally, World Assets Ltd, a subsidiary of the Worldcoin Foundation, announced plans to sell between 500,000 and 1.5 million tokens per week for up to six months to institutional trading firms outside the US. In other words, the parent company itself will exert selling pressure ranging from $70 million to $200 million. Increased user enthusiasm for the project could mitigate the negative impact of unlocking.
However, the requirement for retinal scanning to join the community faces increasing resistance from regulators. This is evident in the project’s geographical breakdown, where Asia, Africa, and Latin America account for 82.4%, and user interest primarily revolves around obtaining the 25 WLD ($138) starter bonus.
But even in these regions, there is a growing trend of prohibitive measures against Worldcoin, and in Europe (following bans by Spain and Portugal), only Germany remains as a viable market for user acquisition.
Considering the presence of the black market for World ID and violations of international law (such as retinal scanning of children), the project will face increasing challenges in attracting new participants. Coupled with the controversial tokenomics, the future of WLD investors does not look promising.