The cryptocurrency market is notorious for its volatility, and Worldcoin (WLD) has been no exception. After plunging over 84% from its all-time high (ATH) of $11.74 in March 2024, Worldcoin hit a 12-month low of $1.34, sparking concern among investors. However, recent price action indicates that a bullish recovery may be underway. This recovery comes amid Alameda Research’s liquidation of over 1.5 million WLD tokens, a move tied to the ongoing FTX customer and creditor payouts.
Worldcoin’s Journey So Far: From ATH to Lows
Worldcoin, a mid-cap altcoin, has seen a significant decline from its ATH. At its peak, WLD was one of the most talked-about cryptocurrencies, with a fully diluted valuation over $17 billion. However, like much of the market, it has since faced strong bearish pressure, leading to a sharp drop in price.
The combination of overall market weakness and significant sell-offs has kept WLD under pressure. Alameda Research, the sister company of the embattled FTX exchange, has been a notable seller, liquidating its WLD holdings over the past two months to raise funds for its $16 billion customer and creditor payouts. As part of this liquidation process, Alameda deposited 1.56 million WLD tokens across ten batches, each consisting of approximately 143,000 tokens. Despite these challenges, there are signs that Worldcoin is staging a comeback.
Technical Indicators Hint at a Potential Bullish Reversal
Despite Alameda’s mass sell-off, technical analysis reveals that Worldcoin may be on the cusp of a bullish reversal. Over the past three months, WLD has managed to break out of its long-term downward trend and has retested its 50-day moving average (MA). This is a positive indicator, as it suggests that the market sentiment around Worldcoin is starting to shift.
Additionally, WLD’s daily chart shows the formation of an inverted double bottom pattern, often seen as a sign of market reversal. Paired with rising divergence in the Relative Strength Index (RSI), this pattern suggests that buyers may be regaining control, potentially pushing the price higher in the near term.
Alameda Research: Selling Off WLD to Fund FTX Payouts
Alameda Research has been a key player in the crypto ecosystem, and its recent movements have had a direct impact on WLD. Since early August, the firm has deposited 1.56 million WLD tokens across several batches. This steady selling pressure has contributed to WLD’s price decline, but as Alameda continues to offload assets to fund FTX customer and creditor repayments, the market has started to absorb the impact.
Even after selling a portion of its holdings, Alameda still holds over 23 million WLD tokens, valued at more than $43 million. While the market is aware that further sell-offs are likely, it remains to be seen how these transactions will affect WLD’s price trajectory moving forward.
Worldcoin’s Potential for Future Growth
Despite recent bearish sentiment, Worldcoin remains a project with strong potential. Its price drop has been steep, but the underlying fundamentals of the Worldcoin network continue to develop. The project’s unique approach, aiming to create a global financial network that leverages biometrics and blockchain technology, keeps it in the spotlight as a contender for long-term growth.
The recovery in network activity, along with the technical indicators showing a potential reversal, points to a possible bullish recovery. If WLD can break above key resistance levels and hold its recent gains, the project may experience a resurgence in investor interest, driving prices back toward the $2 mark and possibly higher.
Conclusion: Is Worldcoin Ready for a Comeback?
While Worldcoin has endured a rough few months, with Alameda Research’s liquidation adding downward pressure, there are signs of a potential turnaround. Technical indicators, including the RSI and the retest of the 50-day moving average, suggest that a bullish reversal may be in the works.
Investors should remain cautious, as Alameda’s continued sell-offs could create further volatility in the short term. However, if Worldcoin can maintain its recent momentum and break above key resistance levels, the project may be well-positioned for a recovery, with potential gains on the horizon.
As the cryptocurrency market continues to evolve, Worldcoin’s future remains uncertain but promising, making it a token to watch as we move into 2024.
