Reddit To Discontinue Community Points Within Weeks
Subreddit-linked Tokens MOON and BRICK Crater After Surprise Decision
By: yyctrader •
Reddit will be phasing out its use of crypto-based Community Points by early November. The decision to discontinue the rewards system no doubt comes as a shock to many users who have embraced the technology as a way to earn and trade digital assets within their favourite subreddits.
The MOON token - linked to r/CryptoCurrency - crashed 80% in the wake of the news.
Meanwhile, r/FortNiteBR Bricks are down 35% after earlier dropping as much as 70%.
Reddit's decision is driven by a desire to refocus its efforts and allocate resources toward other areas of development, according to TechCrunch. The blockchain-based Community Points system was first introduced in 2020 with the goal of giving users a sense of ownership and value within Reddit communities.
Community Points enable users to earn and spend tokens for various activities such as posting quality content, engaging with the community, and performing moderator duties. These tokens were originally stored on the Ethereum blockchain, allowing users to trade them outside of Reddit.
However, despite an initial wave of popularity and positive reception, concerns over scalability and usability have plagued the Community Points system. The blockchain infrastructure required to support the rewards became increasingly burdensome, leading to issues with transaction throughput and high gas fees.
The points program migrated to Arbitrum Nova in 2022 to address these challenges.
Reddit Taps Layer 2 and FTX For Community Token
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A Reddit spokesman acknowledged the challenges faced by the blockchain-based reward system and expressed gratitude to the early adopters who enthusiastically embraced the technology. The company reassures users that their existing Community Points will not be lost, and they will be provided with guidance on how to convert the tokens to another format in the future.
Reddit says it’s exploring alternative ways to provide engaging and rewarding experiences for users within its platform.