Reddit is set to bid farewell to its blockchain-based reward system, Community Points, which initially garnered attention as a means to incentivize user engagement. This decision is scheduled to take effect on November 8th.
The official statement from a community team member explained that despite their initial enthusiasm for Community Points, they found it challenging to scale the program across their platform due to regulatory constraints and resource limitations. The social media giant acknowledged the positive support from moderators and communities but cited difficulties in continuing the project’s growth.
However, they are not abandoning the idea of rewarding contributions entirely.
New Contributor Program Introduced
In place of Community Points, Reddit is introducing a new Contributor Program. This program aims to reward eligible users with cash based on their karma and gold earned from qualifying contributions. Additionally, features originally part of the Community Points beta, such as subreddit karma and gifs, will become accessible to all communities.
“Time and efforts previously spent on Community Points can now be directed to more scalable programs, like the Contributor Program, which we believe can provide value to more Redditors,” the announcement reads.
Tokens Crash as Community Points Get Axed
Community Points were introduced in 2020, build on top of the Ethereum (ETH) blockchain and aimed to reward users for positive engagement in specific communities, such as earning upvotes for their contributions. These rewards were represented as ERC-20 tokens stored in the platform’s crypto wallet called the ‘Reddit Vault.’ Users could redeem their Community Points for various perks, enhancing user engagement and community participation.
While the project initially launched on Ethereum, it later migrated to the Layer 2 Arbitrum Nova in 2022 to reduce transaction costs and enhance scalability. This change allowed users to earn, trade, and utilize tokens like ‘Moons’ and ‘Bricks’ within different subreddits.
However, Reddit’s decision to discontinue Community Points has led to a significant decline in the value of these tokens, disappointing the crypto community and users who had invested time and effort into earning them.
As of the latest data at press time, the price of MOON, the cryptocurrency used within the r/CryptoCurrency subreddit, stood at $0.030, a crash of over 86% since the announcement was made.
Users Claim Reddit is Rug-Pulling Them
Unsurprisingly, Reddit’s announcement received strong criticism from its user base, particularly from international users who are currently ineligible for the new Contributor Program, which will reward users based on their karma and gold earned from contributions.
While many users felt that their efforts had been wasted, some even called these actions a “rug pull” that negatively impacted the crypto market.
Additionally, the r/cryptocurrency moderator “CryptoMods” added in response to the initial statement that they had just learned of the decision and were “disappointed” by it.
“We plan to continue with Moons independently, whether that be through taking over smart contract ownership (if possible) or airdropping a new token 1:1 with current balances,” CryptoMods maintained.