- Reddit launched Group Factors in 2020 for customers to reward one another with tokens.
- Customers on the platform reacted sharply to the choice; some vital, others appreciative.
On 17 October, Reddit introduced its determination to wind down its Ethereum [ETH]-based Group Factors by 8 November.
A Reddit Group group member, cozy_sheets, posted the message throughout completely different subreddits similar to r/CryptoCurrency, r/ethtrader, and r/FortNiteBR. These subs use the MOON, BRICK, and DONUT tokens, respectively, for transactions.
Reddit’s Group Factors are ERC-20 tokens, i.e. fungible tokens created utilizing the Ethereum blockchain. The social media platform launched Group Factors in 2020.
These tokens had been initially minted on the Ethereum community earlier than being moved to scaling community Arbitrum [ARB] Nova in 2022.
Reddit used to retailer these tokens in its pockets, known as Vault. Customers reward one another with these tokens for making significant contributions to the subreddits.
Reddit’s director of shopper and product communications Tim Rathschmidt advised TechCrunch,
“Although we noticed some future alternatives for Group Factors, the resourcing wanted was sadly too excessive to justify… The regulatory atmosphere has since added to that effort.”
As soon as this system is totally phased out, beta members will not discover their factors of their Vaults or earn factors within the communities.
If we have a look at the value charts of those tokens publish the announcement, it was nothing in need of mayhem. Notably, MOON’s worth dropped by 85%. At press time, it was buying and selling at $0.033.
Supply: MOON/USD, CoinMarketCap
BRICK has misplaced 60% of its worth; it was exchanging fingers at $0.06 at press time.
Supply: BRICK/USD, CoinMarketCap
DONUT has equally misplaced round 60% of its worth; at press time, it was buying and selling at $0.006.
Supply: DONUT/USD, CoinMarketCap
How Reddit customers responded
Reactions to the event poured in quickly after Reddit introduced its determination. One person reported dropping a big sum because the platform introduced the choice.
“Kinda gutted since I spent properly over 25k on moons .. lesson discovered I suppose, nothing else however BTC and eth any further”
One other person, nevertheless, was optimistic that this transfer will purge the platform of these people who find themselves solely there to farm tokens.
“Possibly this transformation could have a optimistic impression and customers who had been right here only for the factors will slowly depart.”
Kraken co-founder and CEO Jesse Powell commented on Reddit’s newest transfer, saying,
“I personally don’t see the regulatory issues however I get that it’s difficult and evolving and perhaps Reddit doesn’t need the trouble.”
Powell recommended the platform ought to supply a redemption path, similar to providing Collectible Avatars or Karma, in change for the Group Factors.
