Musk lawsuit puts spotlight on ZachXBT’s Worldcoin scam claims

On-chain investigator ZachXBT has accused Sam Altman-linked Worldcoin, now known as World, of using a harmful token model tied to biometric data collection. 

The comments came after Elon Musk referred to OpenAI CEO Sam Altman as “Scam Altman” on X.

ZachXBT claimed Worldcoin used a “predatory low float crypto token” structure. He also compared some of its practices to tactics linked to Sam Bankman-Fried and FTX, while raising concerns over WLD token sales and user recruitment.

Biometric data collection faces criticism

Worldcoin was launched as a human verification project using iris-scanning devices called Orbs. The project gives users WLD tokens after verification, but critics have questioned how it operates in low-income regions.

ZachXBT alleged that the project exploited vulnerable users by offering small token rewards in exchange for biometric data. He also claimed the system helped create a black market for verified accounts.

According to screenshots shared by ZachXBT, some verified accounts were allegedly sold for as low as $0.50 on escrow platforms. He argued that such activity weakens the project’s claims around privacy and security.

WLD token sales draw attention

ZachXBT also pointed to alleged WLD token sales by the World Foundation. One image he shared claimed the foundation sold 85.45 million WLD for $25 million through FalconX at an average price of $0.293.

He further alleged that the project had issues around token supply and insider selling. He cited past reporting from MIT Technology Review, which had questioned Worldcoin’s early recruitment methods and its use of cash incentives.

Worldcoin has faced debate for years over privacy, token distribution, and its global user onboarding model. The latest claims add pressure as the project continues to expand its identity network.

Musk lawsuit adds market focus

The allegations surfaced as Elon Musk’s lawsuit against OpenAI and Sam Altman heads to trial. Musk claims Altman and other OpenAI leaders moved away from the company’s original nonprofit mission.

Reports said jury selection was completed on Monday in a California federal court. Musk is seeking damages from OpenAI and Microsoft, according to a person linked to the case.

Prediction markets remain divided on the outcome. Kalshi and Polymarket both placed Musk’s odds of winning the OpenAI lawsuit at about 60%.

WLD price fell more than 2% after the latest allegations. The token traded near $0.25, with a 24-hour range between $0.25 and $0.26.

CoinGlass data showed mixed derivatives activity. WLD futures open interest rose over 7% in 24 hours to $177.51 million, while short-term open interest on Binance, OKX, and Bybit declined.