Blockchain-Based Community Points Program
On October 17th, Reddit, a popular social network platform, announced the discontinuation of its blockchain-based community points program due to scalability issues, causing a stir in the crypto community. This news resulted in the price of the native tokens of various subreddits, such as Moons (MOON) for r/CryptoCurrency and Bricks (BRICK) for r/FortNiteBR, to plummet.
At the time, moderators of the subreddits involved with the program stated they had no prior knowledge of the decision. However, recent on-chain data suggests that some moderators holding Moons may have been linked to three wallets that dumped millions of tokens shortly before the announcement.
For instance, on-chain analysts such as Pledditor observed that subreddit moderator u/Mcgillby transferred more than 100,000 MOON over two different transactions on the Arbitrum Nova blockchain, converting it into over $23,000 in Ether (ETH). This user then deleted all their previous Reddit posts.
This illustrates how web 3.0 tokens can be used to invest, buy, and get involved in the technology, and how it differs from web 2.0. As such, it is important to understand the implications of blockchain technology in order to make informed decisions.
In another instance, just 17 minutes prior to Reddit’s statement, moderator u/Rider_of_the_storm supposedly moved 345,422 MOON, worth more than $69,000 at the time, to an exchange address. The Reddit account in question has since been deactivated. As per Lookonchain, on-chain data demonstrated that at least three of the administrators managing the cryptocurrency subreddit sold their tokens a few minutes before the announcement was made public.
A statement from the Reddit moderators clarified that they received the notice about the termination of the community points program an hour before, implying that the three moderators could have used the information to dump their web 3.0 tokens.
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