Reddit Taps Layer 2 and FTX For Community Token
Social Media Giant to Launch Arbitrum-based ERC20 Tokens
By: Aleksandar Gilbert •DeFi News
Arbitrum Nova, a Layer 2 blockchain that aims to improve the gaming and social media experience on Ethereum, debuted Tuesday alongside Reddit’s Community Points program.
Reddit, the popular social media platform with 400M monthly users and hundreds of thousands of topic-specific communities known as “subreddits,” will enable its communities to issue Ethereum-based tokens known as Community Points.
By setting rules that determine how its Community Points are allocated, a subreddit can encourage engagement and create polls that give added weight to dedicated, long-term users, according to the social media giant.
According to Offchain Labs, the company building Arbitrum, Reddit selected Arbitrum Nova as its partner after it bested other Ethereum L2s in a competition titled “The Great Reddit Scaling Bake-Off.”
“Nova is the ideal chain for projects with cost-sensitive and high transaction volume expectations,” Offchain Labs said in a news release, “including games that frequently mint new items and currency, or social projects with different levers for on-chain interactions.”
Layer 2 blockchains like Arbitrum and Optimism are meant to address the shortcomings of Ethereum, such as expensive transaction fees and network congestion.
In addition to Nova, Reddit has partnered with crypto exchange FTX. Users who have insufficient Ether to pay the transaction fees required to transfer Community Points will be directed to FTX Pay to top up their wallets.
Community Points will first be made available on the Fortnite videogame subreddit, along with the cryptocurrency subreddit, according to FTX.