The price of WorldCoin has just started to recover, and before the altcoin can recoup its lost profits, the developers have made a big announcement.
Worldcoin Token Unlocking: Impact on Price
The price of Worldcoin is currently trading at $2.56, having risen 63% throughout June and early July. However, WLD has gained 37% in the past 24 hours, erasing some of its recent losses.
The recovery momentum WLD is building may soon come to a halt as the latest update announces a major token unlock. Worldcoin developers announced in a blog post on Tuesday that starting July 24, WLD tokens allocated to Tools for Humanity (TFH) investors and team members will begin to unlock.
While the Worldcoin protocol and token launch in July 2023, the TFH supply is locked for one year to allow the protocol to mature before holders can sell that supply.
So, one year later, next week, this unlock will begin. The process will be linear, with 2 million WLDs unlocked per day, worth approximately $5 million. This situation will last for four years until 2024.
Concerns in the Market
This token unlock has raised concerns among altcoin investors and the crypto market. Token unlocks are typically viewed as bearish events, as the influx of additional tokens into the circulating supply can sometimes exceed demand, causing the price to fall.
Developer Strategy
In response to these concerns, Worldcoin developers have stated that extending the unlocking schedule will slow the growth of the circulating supply, potentially mitigating the negative impact on price.
The final impact of the token unlock is expected to be seen next week, with potential changes in the price of Worldcoin. Currently, WLD is attempting to break above the $2.78 resistance level, which will be a critical milestone for the altcoin’s price trajectory.
