Reddit has decided to phase out its cryptocurrency-based “Community Points” reward tokens, leading to a sharp sell-off among holders. The tokens were initially introduced three years ago to incentivize high-quality contributions on the platform. According to TechCrunch, Reddit plans to completely discontinue them by November 8.
Initially minted on the Ethereum network, Reddit’s Community Points were later migrated to the Arbitrum Nova scaling network. The ERC-20 tokens could be redeemed for various Reddit perks, such as badges, emotes, GIFs, and other features.
In response to the announcement, holders have been liquidating their holdings of two tokens—MOON and BRICK—causing their prices to plummet. MOON, associated with the r/Cryptocurrency subreddit, has fallen by 84% to a current price of $0.035. BRICK, tied to r/FortniteBR, has seen a 59% drop over the past 24 hours, trading at $0.041 as per CoinGecko.
“The resourcing needed was unfortunately too high to justify,” stated Tim Rathschmidt, Reddit’s Director of Consumer and Products Communications. He further cited the challenging regulatory environment as a contributing factor to the decision.
While the Community Points program is coming to an end, Rathschmidt confirmed that Reddit’s “Collectible Avatars initiative continues.” The news has received mixed reactions from Reddit users, with some expressing apathy, and others praising the decision.
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