ZachXBT сompares Worldcoin model to FTX tactics

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ZachXBT сompares Worldcoin

Highlights

ZachXBT accused World (formerly Worldcoin) of using a predatory token distribution model.
The project allegedly collected biometric data from people in developing countries in exchange for small token rewards.
Token supply is increasing to unsustainable levels, with alleged insider selling.

ZachXBT stated that World deserves far more scrutiny than it currently receives. He accused the project of launching its WLD token with a predatory low float, comparable to the practices of Sam Bankman-Fried’s FTX. According to the investigator, the company exploited people in low-income countries by offering small amounts of tokens in exchange for their biometric data (iris scans).

ZachXBT argued that the promised identity technology has instead led to a black market for verified accounts. He shared a screenshot showing such accounts being sold on escrow platforms for as little as $0.50 each, raising questions about the security and reliability of the system.

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Instead of delivering on its promise of secure identity verification, the project has allegedly contributed to the creation of a black market for verified accounts. Meanwhile, token supply continues to grow to unsustainable levels, while insiders quietly sell their holdings through over-the-counter deals.

Scrutiny grows amid Musk-Altman dispute

ZachXBT’s post appeared amid a renewed conflict between Elon Musk and Sam Altman. Musk is suing OpenAI and has accused Altman of moving the company away from its original nonprofit mission. Elon Musk also referred to Sam Altman as “Scam Altman” in his post, adding another layer to the public dispute around Altman and Worldcoin.

Against that backdrop, Worldcoin came under fresh pressure. ZachXBT also claimed that WLD supply is rising to unsustainable levels and that insiders are quietly exiting their positions through over-the-counter deals. Reports also pointed to the World Foundation selling 85.45 million WLD for $25 million through FalconX, at an average price of $0.293.

The market reaction was negative. WLD fell more than 2% to $0.2519, with a daily trading range of $0.2477-$0.2579. At the same time, 24-hour trading volume rose by nearly 7%, while open interest in WLD futures increased to $177.51 million.

Reputation risk for a digital identity project

The dispute around Worldcoin matters beyond the price of WLD. The project is building digital identity infrastructure based on biometrics, meaning user and regulator trust is one of its most important assets. If verified accounts are being widely traded on black markets, it raises questions about the practical resilience of the World ID model.

ZachXBT’s criticism also revives earlier concerns about the project’s tokenomics: low float, major unlocks, foundation sales and possible insider pressure. For crypto markets, that is a familiar set of risks after the collapse of FTX: limited circulating supply can support price early on, but growing issuance and large-holder sales often weigh on the market.

For now, ZachXBT’s claims remain allegations, not legally established facts. But the discussion shows that Worldcoin will likely have to answer not only questions about privacy and biometrics, but also concerns over the economics of WLD.

Implications for the crypto industry

The criticism from ZachXBT, one of the most respected independent investigators in the crypto space, highlights growing concerns about the ethics and transparency of major projects that handle sensitive biometric data.

The case of World underscores the potential reputational and regulatory risks facing projects that combine cryptocurrency incentives with personal data collection.

In addition, we wrote that ZachXBT exposes North Korean IT network generating $1 million per month.

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