Tools of Humanity, the developer behind the Worldcoin project, has decided to delay the unlock schedule for 80% of its Worldcoin (WDL) tokens. This move has caught the attention of investors and early contributors.
Originally, these tokens were scheduled to unlock over a three-year period. However, in a strategic decision aimed at ensuring the project’s long-term stability, Tools of Humanity has extended this period to five years. The new unlock schedule will commence on July 24, 2024, and the tokens will become accessible progressively over the next four years, concluding by the end of July 2028.
A Strategic Decision
This change in the unlock schedule is significant for several reasons. According to officials from Tools of Humanity, the decision was made with the protocol’s long-term vision in mind. Extending the unlock period will release fewer tokens into the market immediately. This strategic move is intended to prevent a sudden supply increase that could lower the token’s price.
The impact of this decision was almost immediate. The WDL token rose nearly 20% on the news, trading at $2.36 at the time of writing. This price increase indicates investor confidence in the project’s future stability and growth.
The Role of World ID
Worldcoin, co-founded by OpenAI’s Sam Altman, is centred around the concept of “World ID,” a digital identity verification system. This system allows users to verify their humanity by having their irises scanned by a device known as an “Orb.” As of April 2024, Worldcoin’s World App boasted 10 million registered users, demonstrating substantial growth and adoption.
The majority of WDL tokens currently in circulation are held by these registered users with an orb-verified World ID. Since its launch in July 2023, more than 211 million WDL tokens have been claimed by World ID holders, representing more than 77% of the 275 million WDL currently in circulation. This data, provided by the Worldcoin Foundation, highlights the project’s extensive reach and engagement.
Financial Implications
The Worldcoin Community pool currently holds $7.22 billion worth of WDL tokens in its treasury. This substantial reserve provides a strong financial backbone for the project, allowing Tools of Humanity to make strategic decisions such as delaying the token unlock schedule.
According to reports, Tools of Humanity informed the Worldcoin Foundation of this decision on July 15. The foundation has since supported the move, recognizing the potential benefits of reducing market volatility and ensuring a more controlled release of tokens.
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Tools of Humanity-Market Reactions
The crypto market’s reaction to Tools of Humanity’s announcement has been overwhelmingly positive. Analysts suggest that the delay in unlocking the token could lead to more sustainable growth for Worldcoin. The project can mitigate the risks associated with sudden price drops by reducing the number of tokens entering the market simultaneously, often seen when large volumes of tokens are released simultaneously.
Regulatory Scrutiny
Despite the positive market reactions, Worldcoin has not been without its challenges. The project has faced criticism and regulatory scrutiny, particularly regarding the use of biometric data from iris scans. Privacy and data security concerns have been raised by various stakeholders, prompting Tools of Humanity to address these issues proactively.
In response to these concerns, Tools of Humanity has implemented rigorous data protection measures and transparent practices to reassure users and regulators alike. The project’s commitment to safeguarding user data is seen as a crucial factor in maintaining trust and ensuring the project’s long-term success.
Looking Ahead
The delay in the unlock of 80% of WDL tokens by Tools of Humanity marks a pivotal moment for the Worldcoin project. This strategic decision reflects a careful consideration of market dynamics and long-term goals. Tools of Humanity aims to foster a more stable and sustainable growth trajectory for Worldcoin by extending the unlock period.
As the new unlock schedule begins on July 24, 2024, the crypto community will be watching closely to see how this move impacts the market. With a substantial number of tokens now set to be released over a five-year period, Tools of Humanity has positioned itself to navigate the complexities of the crypto market effectively.
Conclusion
Tools of Humanity’s decision to delay the unlock of 80% of WDL tokens underscores the company’s commitment to the long-term success of the Worldcoin project. By extending the unlock schedule from three to five years, Tools of Humanity aims to ensure a more stable release of tokens, thereby preventing market volatility and fostering sustainable growth. As the crypto community awaits the implementation of this new schedule, the positive market reaction suggests confidence in the project’s future. With strong financial backing and a growing user base, Tools of Humanity continues to advance its vision for a digitally verified global identity system.
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