Revamping Worldcoin: A Deeper Dive into the New Token Strategy
Worldcoin announced several changes to its token strategy on October 22, 2023. These modifications are intended to make the Worldcoin ecosystem more sustainable and fair and align all stakeholders’ incentives.
What is Worldcoin ?
As we all know, AI continues to advance at a breakneck speed. While AI has many advantages, such as time savings and writing prompts, it also has significant drawbacks and risks, such as deepfakes and fraud.
Concerning these points, On July 24, 2023, OpenAI CEO Sam Altman unveiled Worldcoin as a new cryptocurrency that provides a new and unique way of identification that reduces the risk of fraud, and all the eyes are on it – literally. The new cryptocurrency detects “personhood” through an eye scan, proving that someone is a person, not a robot.
Worldcoin is a global identification and financial public network that aspires to give everyone a unique digital identity and a stake in the global economy. Worldcoin verifies users’ identities using iris biometrics and distributes its native cryptocurrency, WLD, to users for free.
The original token plan for Worldcoin was to give the majority of tokens to users, with a smaller number going to Orb Operators (who help distribute tokens and verify users’ identities) and the Worldcoin Foundation (which funds continuing network development and maintenance). Tokens were to be vested over two years.
Here are the key details of Worldcoin’s initial token strategy:
- Total token supply: 100 billion WLD
- Token distribution:
- 80% to users
- 15% to Orb Operators (who help to distribute the tokens and verify users’ identities)
- 5% to the Worldcoin Foundation (to fund ongoing development and maintenance of the network)
- Vesting schedule:
- Tokens for users and Orb Operators will be vested over a period of two years.
- Tokens for the Worldcoin Foundation will be vested over a period of one year.
Worldcoin is still in the early stages of development, but the initial token strategy has been carefully developed to accomplish the project’s goals of developing a worldwide identification and financial public network that is open to all.
The Need for Change in Worldcoin’s Token Strategy
One of the primary reasons for the changes is to make the Worldcoin ecosystem more sustainable. Worldcoin hopes to lessen the impact of inflation on the token and stabilise its price by reducing the total token supply, extending the token vesting timetable, and lowering the loan amount to market makers. In the long run, this will make the Worldcoin ecosystem more sustainable.
Another purpose for the adjustments is to improve the equity of the Worldcoin ecosystem. Worldcoin hopes to ensure that all stakeholders are compensated for their services to the network by increasing token distribution to users and switching from USDC to WLD rewards for Orb Operators. This will improve the fairness and justice of the Worldcoin ecosystem.
Alignment of incentives
The token strategy adjustments are meant to match the incentives of all stakeholders. Worldcoin hopes that by lowering the loan amount to market makers, it will lessen the danger of market manipulation and give market makers more incentive to offer liquidity on exchanges. By transitioning from USDC to WLD rewards for Orb Operators, Worldcoin hopes to motivate Orb Operators to keep WLD tokens and contribute to the project’s long-term growth.
Worldcoin’s New Token Strategy: Significant Changes
Reduced token supply
Worldcoin tokens will be cut from 100 billion to 50 billion. This increases the value of each token while also making the ecosystem more sustainable.
Increased token distribution to users
Users will now receive 20% of all freshly produced tokens, up from 10%. This will reward users for participating in the Worldcoin network and aid in the more equitable distribution of tokens.
The new token vesting schedule
Tokens will be vested over four years rather than two years. This will help avoid excessive volume of tokens from being sold on the open market and create a more orderly distribution of tokens.
New token use cases
Worldcoin tokens will now be utilised for a broader range of activities, such as governance, staking, and rewards. This will improve the token’s value and usability for users.
According to Worldcoin, these reforms aim to build a more sustainable and equitable ecosystem for all stakeholders. Worldcoin hopes to build a system where everyone benefits from the network’s success by limiting the token supply, increasing token distribution to users, and extending the token vesting schedule.
Worldcoin’s New Token Strategy: Objectives
Distribute the majority of tokens to users:
Worldcoin’s goal is to build a worldwide identity and financial public network that is open to all. To do this, the bulk of tokens will be handed for free to users simply for being unique individuals. This will contribute to Worldcoin becoming fully decentralised and owned by the people.
Early adopters should be rewarded:
Worldcoin is a new and ambitious project. Users that sign up early will receive a higher share of tokens as a reward for early adoption. This will contribute to the development of a strong and thriving community around Worldcoin.
Prevent the selling of large volumes of tokens on the open market:
Worldcoin seeks to avoid the usual problem of early investors and team members dumping huge amounts of tokens on the open market, which can cause the token’s price to crash. To avoid this, Worldcoin will use a vesting schedule for tokens, which means that they will be released tokens steadily over time.
Orb Rewards and Market Maker Agreements
Worldcoin uses Orb rewards to encourage users to become Orb Operators and help distribute tokens and verify user IDs. Orb Operators receive WLD tokens for each user they scan and validate. Orb incentives are critical in the Worldcoin project because they ensure that tokens are distributed fairly and extensively. They also help to build a strong community of Orb Operators committed to the project’s success.
Several exchanges have market-maker agreements with Worldcoin. These agreements help WLD to be liquid and easily traded. WLD token loans are granted to market makers, who use them to provide exchange liquidity. Market maker partnerships are critical for the Worldcoin project because they make WLD more accessible to users and investors. They also help to keep the token’s price stable.
The Reaction of the Community and Investors:
The community and investors have largely reacted positively to the modifications to Worldcoin’s token strategy. Many individuals believe that the modifications will make the Worldcoin ecosystem more sustainable, equitable, and in line with all stakeholders’ motivations.
Some members of the community have raised concerns regarding the change in Orb Operator awards from USDC to WLD. They are concerned that this may increase the vulnerability of Orb Operators to price changes and discourage them from participating in the network. Worldcoin, on the other hand, has declared that it is committed to assisting Orb Operators and will continue to monitor the situation and make adjustments as necessary.
Overall, the community and investors appear to be bullish on Worldcoin’s future. The adjustments to the token strategy are viewed as evidence that the team is dedicated to creating a long-term and sustainable ecosystem.
Here are some particular examples of positive community feedback:
“I think the changes to the token strategy are a good thing. They will make Worldcoin more sustainable and equitable in the long term.” – Reddit user
“I’m excited about the switch to WLD rewards for Orb Operators. It shows that Worldcoin is committed to supporting the people who are helping to build the network.” – Twitter user
Worldcoin’s latest changes to its token strategy are a positive step toward creating a more sustainable, equitable, and aligned environment. The improvements are intended to lessen inflationary pressure on the WLD token, reward users for their contributions to the network, and align the incentives of all stakeholders.
The community and investors have generally reacted positively to the modifications, with many people believing that they would make Worldcoin more appealing to users and investors in the long run.
We are eager to watch how these improvements affect the Worldcoin ecosystem in the coming months and years.Community believes that Worldcoin has the potential to create a truly global identity and financial public network that is open to all.