Bull vs. Bear: Worldcoin's WLD

AI hype turned the WLD token into a meme coin. Can it sustain the gains?
Mar 1, 20243 min read

Worldcoin is in the big leagues now after a massive buying spree, fueled by AI investing narratives, pushed the low-float token's fully diluted value (FDV) into the stratosphere.

The project is now sporting a nearly $80 billion FDV, but with just 1.4% of the project's tokens currently in circulation, there's a big asterisk to that figure. The question is whether the project has any chance of maintaining such a high value as investor token unlocks drastically increase the available supply of the token.

To get a sense of where the token goes next, two Bankless analysts take opposite POVs in our latest Bull vs Bear.

Let's kick things off with the bear case. 👇

🐻 What's the Bear Case for WLD?

Worldcoin drafted off the AI hype train to reach an FDV as high as $90B this month, but the good times can only last so long.

Here’s the bear case for WLD:

  • Upcoming Unlocks: Worldcoin’s insider unlocks begin in July and will quickly bring a staggering 20% of the total token supply to market by the end of the year. Further, Worldcoin is increasing the number of tokens it streams to users from the community supply in coming weeks, adding to potential sell pressure after the circulating supply of WLD increased by 16% in the past month alone.
  • Death of AI Narrative: The explosion of AI stocks has led many in crypto to seek beta; WLD has been a natural recipient of flows given its close linkage to OpenAI founder Sam Altman and the potential need for proof-of-personhood. While high-flying AI tickers like NVDA have shown no signs of slowing down in recent months, air letting out of the AI hype bubble would certainly bring an end to the WLD rally.
  • Lack of Real Use: Currently, the only use cases for WLD are as a farm-and-dump token for recipients and a speculation play loosely linked to AI for degens. Without a compelling reason to hold the tokens, it could be difficult to find demand if the AI narrative falls from grace.

Glitzy narratives are fun to chase until bubbles pop and bag holders are left wondering why they separated from their hard earned dollars for a token down 90%.

🐂 What's the Bull Case for WLD?

Worldcoin has undoubtedly had quite the run recently, driven by OpenAI's Sora announcement, Altman's $7T raise buzz, and Nvidia's earnings. Although gains can’t last forever, several qualities of the eyeball coin suggest this run is far from over.

The bull case for WLD:

  • Accessible, Compelling Narrative: Story and sentiment dictate price action in crypto. Worldcoin pitches a simple AI token narrative by having Altman’s name attached, avoiding hard-to-understand concepts like data availability. OpenAI’s success made Altman a household name and benefits Worldcoin, showing it’s led by a top AI entrepreneur. These qualities provide straightforward appeal to both new and experienced investors, capitalizing on the trend of projects with influential figureheads and straightforward, compelling stories excelling.
  • Unique Value Proposition in AI: Worldcoin's "proof of personhood" offers real, unique utility in AI, distinguishing it in a crowded market filled with protocols feverishly competing over the same use cases like decentralized machine learning or onchain AI agents.
  • Expanding Utility and Ecosystem: Beyond its governance role, WLD is poised for widespread application from e-commerce to social media integrations. Integrating with services like Shopify, Telegram, and Discord, it shows versatility and mainstream adoption potential. Some expect use cases will broaden to include payments within the World App or tipping, providing more reasons to hold WLD.
  • Strong Capital and Investor Support: Worldcoin’s last round raised $115M from heavyweight VCs like a16z, Blockchain Capital, and Bain Capital Crypto. These top-tier investors’ involvement provides the capital necessary for growth and also serves as a vote of confidence in Worldcoin that retail investors may take as signaling a solid foundation with high growth potential.

In summary, Worldcoin's clear narrative, unique utility, burgeoning ecosystem, and substantial investor backing position it to continue its bullish momentum.

Agree or disagree? Take it to the comments!

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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here.

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