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Worldcoin Launches with Supply Primarily Comprising Market Maker Loans


Market makers described the agreement as “easy money,” according to a digital assets product manager.

On Monday, as Worldcoin native token WLD experienced a surge. That identity-oriented organization released a whitepaper that explains its tokenomics and offers essential insights.

According to the document, the network will fix WLD’s total supply. The maximum number of coins created, at 10 billion WLD for at least the first 15 years. Following this period, in the year 2038, voters may introduce an inflation rate of 1.5%.

CoinGecko reports that the 10 billion tokens were minted ahead of the launch. Resulting in a fully diluted valuation of $20.6 billion. The market capitalization of the tokens’ circulating supply, comprising approximately 106 million WLD tokens, is valued at around $219 million.

Tom Dunleavy, the founder of Alethia told Decrypt that the mismatch between WLD’s total and circulating supply is concerning.

Most tokens that have a small amount of distribution or a large fully diluted valuation have shown themselves to be easy targets for quick sell-offs. The history of airdrops, in general, has not been favorable.

WLD is creating a financial network

Sam Altman, the CEO of ChatGPT-maker OpenAI, co-founded Worldcoin with the aim of creating a financial and identity network. The company has developed an app for payments and utilizes biometric data obtained from shiny, metal orbs to generate so-called World IDs. This approach has sparked controversy in the industry.

WLD, listed on a handful of crypto exchanges following the Worldcoin Protocol’s launch, has surged by 22% over the past day, reaching $2.04.

SAN FRANCISCO, CALIFORNIA – OCTOBER 03: OpenAI Co-Founder & CEO Sam Altman speaks onstage during TechCrunch Disrupt San Francisco 2019 at Moscone Convention Center on October 03, 2019 in San Francisco, California. (Photo by Steve Jennings/Getty Images for TechCrunch)

Interestingly, the availability of the whitepaper wasn’t as widespread as one might assume from Worldcoin’s name. Decrypt in the US and UK encountered an “unavailable” link to the document, despite Worldcoin users having the ability to verify their identity across 14 locations in both regions. However, the whitepaper was accessible to Decrypt in Colombia.

The whitepaper acknowledges that at launch, the circulating supply of WLD was limited to 143 million tokens, which is considered “relatively low” when compared to the 10 billion tokens. The document attributes this decision to the objective of establishing a network that includes as many human beings as possible.

Worldcoin circulating supply for early users

Worldcoin allocated 43 million tokens from the circulating supply for early users, while an additional 100 million tokens were loaned to five market makers outside the US. These loans, with a three-month duration, provide market makers the option to purchase WLD tokens instead of returning the loan.

Bruno Faviero, co-founder, and CEO of token distribution platform Magna, informed that while WLD’s earmarked allocation for community members is “laudable”, The low circulating supply, mostly consisting of loans, poses challenges in gauging the community’s reaction.

According to the whitepaper, the share of tokens not allocated for Worldcoin’s community increased from 20% to 25%. Because the network’s launch and development “proved to be more complex and costly than TFH initially anticipated.” The announcement of this change was made in 2021.

Tools For Humanity (TFH) played a crucial role in the establishment of Worldcoin, will manage the 170 million WLD reserve. According to the document, tokens owned by the network’s team and investors are locked up at launch.

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