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Worldcoin could take a further hit with over $230 million unlocks in September

fxstreet.com 03 September 2024 08:18, UTC

Worldcoin will see its supply grow by over $230 million in September.
$WLD's price has shown an inverse correlation with its circulating supply.
On-chain data shows that 95% of addresses are holding $WLD at a loss.

Worldcoin ($WLD) is up 2% on Monday but risks a heavy decline in the coming weeks following unlocks worth over $230 million in September. This follows a nearly 90% decline from its all-time high in March.

Why investors need to be cautious with $WLD

Token Unlocks data reveals that crypto identity project Worldcoin will see one of the highest unlocks in September, with over $230 million worth of new supply entering circulation.

Unlocks often cause a token's price to decline if demand fails to catch up with the new supply.

With such heavy unlocks, $WLD may see its price decline in the next few weeks. This is evident in its price movement following past unlock events. Since hitting an all-time high of $11.74 on March 10, $WLD has had a series of unlock events, per Token Unlocks data. These unlocks, coupled with the crypto market correction, have sent $WLD down 87% from its all-time high.

As evidenced in the Santiment chart below, $WLD's price and its supply in circulation have been inversely correlated since May 2024.

$WLD On-chain metrics

With a market capitalization of around $587 million and a fully diluted valuation of $14.5 billion, $WLD still has a huge pool of unlocked tokens that could negatively impact its price in the future.

X user @CryptoCondom also commented on $WLD's rising supply:

This is your your friendly reminder that @worldcoin is going to trend to zero. At a $15.1 BILLION dollar FDV, $WLD is exit liquidity for the goat farmers & VCs who are dumping on retail heads daily. $WLD supply inflates 9.56% every week$WLD supply inflates 40.95% every month… pic.twitter.com/noGNdbMZ8g
— CryptoCondom (@crypto_condom) August 28, 2024

A similar trend is visible in Santiment's 180-day Market Value to Realized Value (MVRV) ratio, which shows that all addresses that bought $WLD in the past six months have lost an average of over 35%.

Additionally, IntoTheBlock's Global In/Out of the Money, which tracks the number of addresses/coins in profit/loss, reveals that over 95% of addresses are holding $WLD at a loss.

$WLD Global In/Out of the Money

$WLD currently trades around $1.45, a price level last seen in October 2023.

fxstreet.com