Cryptoverse Upvotes and Downvotes Reddit's Experiment on Ethereum
Though it has many supporters from the Cryptoverse, the long speculated-about, newly-introduced, blockchain-based points system on the popular discussion forum Reddit, unsurprisingly, has its critics too. (Updated at 18:47 UTC: a comment by a Reddit spokesperson has been added at the end of the article).
As reported yesterday, Reddit has confirmed their point system built on top of the Ethereum (ETH) blockchain. Points can be customized by each community and are given as a reward for "quality" posts and comments, which then serve as a reputation score and can be saved or spent on the platform.
At least two customized versions of the points exist on the FortNiteBR and CryptoCurrency subreddits, called “Bricks” and “Moons” - you can already see these symbols by each redditor's name, and many have thousands of these tokens already.
According to Reddit, initially, 50 million points will be distributed based on "karma" (a reward earned for posting popular content) earned. "Then, over the first year, another 50 million Community Points will be distributed. Over time, the amount distributed every cycle will continue to decrease so that the total number of Points will approach a maximum cap of 250 million," the company explained.
Adam Cochran, Partner at decentralized autonomous organization Metacartel Ventures, who is also a moderator for r/cryptocurrency and r/ethfinance, wrote a detailed post on Reddit's loot tokens, but also praised the subreddits' engagement.
I’m one of the mods from the crypto side of this rollout, Fortnite group has 10x the engagement already. No idea about blockchain but is willing to learn, make mistakes and try things to fit in with the cool kids! Huge engagement!— Adam Cochran (@AdamScochran) May 14, 2020
Support for the move has been sent from within the Cryptoverse. Brian Armstrong, CEO of major crypto exchange Coinbase, called this "a huge deal for crypto," arguing that Reddit has done "a great" job launching a utility coin, while setting clear boundaries for it. Though it'd be better to let users connect any wallet they'd like, he says, this is the example of a use case for crypto, and "a model for other crypto startups to emulate for a token launch that helps bring an online community together, and delivers real value."
Others, however, don't share Armstrong opinion. Blockstream engineer Grubles pointed out that the system, currently in beta, is built on a testnet and is yet to move to the mainnet. He also tweeted about a community 'forking' after the currency was added.
TIL that the Ethereum Reddit token thing turned one of the test communities (r/ethtrader) into such a cesspool that it split into a separate new subreddit (r/ethfinance) that doesn't have the community token nonsense. 🤷♂️ pic.twitter.com/rR22Q8Ehxx— grubles (@notgrubles) May 14, 2020
Discussing the Moon and Brick tokens, American Bitcoin developer and entrepreneur, Jimmy Song, called the system "a clear money grab." In his opinion, a company that wasn't in crypto before, suddenly deciding to issue a token, and coming in the game so late, means they're in financial trouble, have less add revenue, and can't get the funds from "normal" investors. Song and crypto analyst Tone Vays also commented on what Vays called "the stupidity of the economics," agreeing that there's nothing actually stopping Reddit from making more of these tokens, in addition to burning, or purposefully destroying, what could potentially be money.
Reddit explained that, in addition to the regular distribution, half of each month’s burned Community Points are reintroduced into the next month’s distribution: "This helps ensure that there are new Points to distribute, even after the maximum cap has been reached."
"We continuously run experiments to explore features that engage our users and communities. With Community Points, we’re working exclusively with two communities to test this feature and gather feedback from our users," a Reddit spokesperson told Cryptonews.com without elaborating any further.