Human identity project Worldcoin denied the recent allegations that it allowed insiders to profit from the movements of its token and highlighted that it has “zero tolerance” for such activities.
On July 17, decentralized finance (DeFi) insights account DeFi Squared published an X post alleging that the Worldcoin (WLD) project engaged in price manipulation. Furthermore, the account said that it was possible that someone from the team “used insider information” to buy the token before the project announced a delay to its native token unlock schedule.
Apart from DeFi Squared, pseudonymous crypto investigator ZachXBT also chimed in, alleging that Worldcoin allowed insiders to profit from its “scam token.” The blockchain analyst said that team members and venture capitalists are complicit in what ZachXBT described as “the biggest scam token of the bull run.”
Worldcoin denies allegations of allowing insider trading
A Worldcoin spokesperson denied the allegations hurled toward it. According to Worldcoin, they are taking these allegations seriously and would not allow such activities. The spokesperson told Cointelegraph:
“The Worldcoin Foundation and contributor Tools for Humanity take any allegation of insider trading, even if unfounded and unsubstantiated, seriously and would have zero tolerance for such activity if it were to occur.”
The spokesperson added that the two organizations have not found evidence validating the claims of insider trading activities and price manipulation. The Worldcoin representative claims that they maintain a strict market integrity policy that works to prevent these activities.
The Worldcoin representative also said that the people covered by their policies are “at all times prohibited from disclosing confidential information relevant to WLD purchasing decisions.” The spokesperson added that during the relevant timings, they were on an active blackout period, prohibiting them from engaging in any WLD trading activities.
Worldcoin delays token unlock by two years
The recent allegations against Worldcoin come amid its decision to delay the unlocking of 80% of its supply by two years. On July 16, Tools for Humanity (TFH) published a blog post extending the unlock period for tokens held by its team members and investors.
Following the unlock delay announcement, WLD prices soared by 68% in two days, making it one of CoinGecko’s top gainers at the time. Currently, the token sits at $2.36.