Reddit has been making recent shifts away from crypto tokens amid concerns about regulatory pressure and how it will affect crypto patterns. In addition, the prices of certain crypto coins, like BRICK and MOON, are dropping.
Reddit has had a community points system in place that has a crypto basis and which gives users free crypto tokens. They came up and released this system 3 years ago. The idea was to incentivise users to make higher-quality posts by giving them financial rewards in the form of crypto. This could then improve the quality of the platform as a whole, or so the theory goes. Now, they are finally deciding to remove the system. The plan is to phase out the system by November 8th.
Users were able to use these tokens on Ethereum’s network originally, later moving to Arbitrum Nova. Users could also use these tokens for several features on Reddit itself, like badges or GIFs.
Several crypto patterns have already shown a plunge in value. MOON was down 84% daily, and BRICK was down 59%. This shows crypto holder confidence plummeting.
There are also more immediate fears that Reddit staff faced in dealing with this. They said that funding such a project was difficult, especially due to the concerns we mentioned previously.
As it currently stands, the stance of the US government seems unclear. The US still seems to be figuring out how to regulate the crypto sector. In the meantime, while crypto rules remain ambiguous, plenty of crypto firms may be caught in the crossfire. This means it would be easier to take a back seat for now, as it seems there is little room for growth until there is a crypto recovery.
The reaction from Reddit users seems mixed. Some seem happy with the change, but crypto enthusiasts are understandably upset.
