Worldcoin Suffers 14% Drop - What’s Next for WLD Amidst Regulatory Challenges?

Worldcoin's price fell by over 14% in the last 24 hours, diverging from the overall crypto market which dropped around 9%.
The reasons behind this decline include increasing regulatory pressure, recent token unlocks, and an ongoing bear market.
WLD has been stuck in a sideways trend for several months since its initial spike from $0.60.
Current market dynamics, including political unrest and token unlocks, have exacerbated Worldcoin's downward trajectory.

Key Takeaways

Worldcoin's price fell by over 14% in the last 24 hours, diverging from the overall crypto market which dropped around 9%.
The reasons behind this decline include increasing regulatory pressure, recent token unlocks, and an ongoing bear market.
WLD has been stuck in a sideways trend for several months since its initial spike from $0.60.
Current market dynamics, including political unrest and token unlocks, have exacerbated Worldcoin's downward trajectory.

Worldcoin Suffers 14% Drop - What’s Next for WLD Amidst Regulatory Challenges?

Why is WLD Experiencing a Drop Today?

Worldcoin (WLD) continues to be impacted by escalating regulatory scrutiny worldwide, with Colombia becoming the latest nation to suspend WLD’s services. The government mandated the immediate deletion of biometric data collected from its citizens, which has significantly hampered operations.

Additionally, both the Philippines and Thailand have issued cease-and-desist orders, further restricting Worldcoin’s activities and disappointing users who were engaging with the platform through its airdrop initiative.

In addition to regulatory challenges, the recent unlocking of over 37 million WLD tokens valued at approximately $25 million has increased selling pressure. Currently, around 42% of the tokens remain locked, amounting to about 4.25 billion WLD coins.

Worldcoin Source: Tokenomist

Furthermore, the overall downturn in the market has heavily impacted WLD, as many cryptocurrencies are experiencing declines, with Bitcoin (BTC) hovering just below the $80,000 mark.

Will Bears Continue to Overpower Bulls?

Looking at the charts, WLD has been trading below a downward slanting trendline for the past three months, indicating a bearish sentiment. Prior to this decline, WLD traded in a stable range from April to September.

The MACD indicator showed that sellers have maintained control, although they have not managed to break below the $0.60 mark significantly. The Cumulative Volume Delta stood at -$10.71 million, signaling that most of the trading volume is coming from short sellers.

WLD Source: TradingView

However, the current price of WLD is nearing a breakout from its consolidation phase as it approaches a critical juncture. Traditionally, a price contraction is often followed by an expansion, but the direction is still uncertain.

As per the liquidation heatmap, there is over $1.5 million in substantial liquidity gathering around the $0.63 price point. Meanwhile, lower liquidity clusters have been depleted, signaling potential upward movement.

WLD Source: CoinGlass

The liquidity building above the $0.63 mark could draw the price up towards that level. This scenario indicates that WLD may be approaching a reversal, especially with its current value exceeding a critical zone and positioning at the apex of a wedge pattern. This suggests that Worldcoin may not continue to fall drastically, with the potential for bullish momentum to emerge in the near future.