Reddit’s Blockchain Experiment: One week in, are Redditors already adopting cryptocurrency?
It’s early days for community website Reddit’s experiment with a new blockchain-based rewards system. However, some interesting trends are already developing and early indications on the popularity of the scheme may come as a surprise to many industry observers.
What’s the plan?
In case you missed the news last week, Reddit, a social news and community-building website with over 400 million monthly users, announced the test launch of two new community points systems built on the Ethereum network.
‘MOON’ points are currently being trialled by the /r/Cryptocurrency community while the ‘BRICK’ points system is being put through its paces by gaming community /r/FortniteBR. Both sets of ‘points’ are actually cryptocurrencies that run on Ethereum’s Rinkeby testnet. If the trial goes well, it is anticipated that the currencies will move to the Ethereum mainnet at the end of summer.
In its launch announcement, Reddit explained; “Community Points are a way for Redditors to earn a piece of their favourite communities. Points can be spent on premium features [such as badges, custom emojis, and GIFs in comments] and are used as a measure of reputation in the community”.
Interestingly though, a lot of the ‘control’ of the points systems will be handed over to the communities themselves:
“Community Points are a tool for communities to customize in their own way. They choose what to call their Points, what they look like, and how they are used in the community.”
Haven’t Facebook, Telegram already tried this?
Facebook’s faltering attempts to haul its own cryptocurrency offering– Libra — to market have been well documented. Messaging app Telegram also recently abandoned its own cryptocurrency experiment, the Telegram Open Network. The news came some months after the SEC ordered Telegram to halt sales of their $GRAM tokens after what it deemed to be unregulated pre-ICO offerings.
What makes Reddit’s foray into blockchain technology different though, is that currently their Community Points can only be spent on Reddit and therefore not used as a form of ‘money’ outside of the platform. They are, therefore, more akin to retailer loyalty points or in-game reward points popular with gamers.
In fact, the selection of the /r/Cryptocurrency and /r/FortniteBR communities as testing grounds for Reddit’s blockchain experiment is an astute one. It’s a fair assumption that the one million members of the /r/Cryptocurrency would be among the most likely to embrace cryptocurrency rewards whilst also having a more nuanced view on how the scheme should work.
The 1.3million members of the Fortnight Battle Royal subreddit will also already be familiar with digital rewards, in the form of V-Bucks, which can be earned within the Fortnite game or purchased and then used to access in-game features.
What’s the uptake so far?
Perhaps surprisingly, at the time of writing, the scheme has proven far more popular within the FortniteBR community than the Cryptocurrency group. 2,515 MOON addresses have been set up by the cryptocurrency subreddit’s users and 2,883 transactions sent (click here for updated numbers). Those figures are currently dwarfed by the 10,903 BRICK addresses and 12,109 transfers utilised by the FortniteBR community.
Perhaps the similarities in utility between BRICK tokens and V-Bucks has sped up adoption among those in the Fortnite community who already see a value in digital assets that are only utilised within a particular online ecosystem. Cryptocurrency enthusiasts, on the other hand, maybe more interested in the investment potential of their MOON tokens, which, as it stands, is zero.
Another potential explanation for the disparity in uptake between the two communities is that /r/FortniteBR is usually far more active than the cryptocurrency-focused group, often featuring in the ‘top 30’ of the Comments Per Day chart.
We might not quite yet be on the brink of a ‘crypto-kitties mania’ style network blockage, but the early adoption signs are encouraging. Once again, as with seemingly all blockchain projects past and present, the experiment will ultimately live and die on whether or not the MOON and BRICK tokens are bestowed with real utility that, in turn, makes them valuable.
Indeed, some keen beans within the Reddit community have already set up a DAO (Decentralised Autonomous Organisation) on the same Rinkeby Testnet that the MOONs and BRICKs reside, in order to “figure out what to do with all of these [tokens]”.
What are the experts saying?
Preston Byrne, a cryptocurrency authority at the law firm Anderson Kill told Fortune that while the introduction of MOON and BRICK tokens to the Reddit ecosystem was a “cool development” he also believed that it was not a game changer for cryptocurrency adoption. He suggested that the experiment doesn’t provide a compelling reason for those outside of the cryptocurrency bubble to adopt the new tokens.
Will Price, a data scientist at researcher Flipside Crypto has a more positive outlook, telling Bloomberg that; “if all goes well, this could be the first step towards a more engaged and invested Reddit community, raising the bar for quality content creation and curation,”. He did also caution though, that the fact that Reddit is retaining 20% of the tokens being distributed may be hard for users to swallow.
Changpeng “CZ” Zhao, CEO of leading cryptocurrency exchange Binance tweeted: “Reddit introduced about 20m new users to cryptocurrency or their own token in a matter of seconds. Thousands of popular websites, likely thousands of tokens. Inevitable #adoption!
Whether “CZ” is right to be so optimistic remains to be seen, but Reddit’s experiment has certainly gotten off to a flying start.
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