Popular social community platform Reddit announced the winddown of its blockchain-based community points program on Oct. 17, citing scalability points. The announcement created controversy within the crypto neighborhood, with many calling it a rug-pull, as the value of the native token on totally different subreddits tanked after the information was revealed.
Each subreddit had its personal native token. For instance, the Moons (MOON) token was the native crypto asset of r/CryptoCurrency, whereas Bricks (BRICK) was for r/FortNiteBR. Users may spend these factors on badges and unique objects for his or her avatars.
At the time of the announcement, the moderators of a lot of the subreddits concerned with the neighborhood factors program claimed to be unaware of the choice. However, that is now being known as into query as new on-chain knowledge means that no less than a few moderators holding Moons could have been linked to 3 wallets that dumped hundreds of thousands of the tokens shortly before the announcement.
On-chain analysts resembling Pledditor have been the primary to attract consideration to the actions of subreddit moderator u/Mcgillby. On-chain knowledge reveals that this moderator transferred greater than 100,000 MOON over two totally different transactions on the Arbitrum Nova blockchain, turning it into greater than $23,000 in Ether (ETH). The consumer subsequently deleted all earlier Reddit posts.
Here is a listing of Reddit moderators performing on inside info BEFORE the announcement: pic.twitter.com/xAh75hOVEa
— Pledditor (@Pledditor) October 18, 2023
In one other incident, simply 17 minutes before Reddit’s assertion, moderator u/Rider_of_the_storm allegedly shifted 345,422 MOON, price over $69,000 on the time, to an alternate deal with. The Reddit account in query has since been deactivated. According to Lookonchain, on-chain knowledge confirmed that no less than three of the directors overseeing the cryptocurrency subreddit liquidated tokens some 20 to half-hour before the announcement went public.
— Lookonchain (@lookonchain) October 19, 2023
A press release from the Reddit moderators clarified that they acquired the discover in regards to the termination of the neighborhood factors program an hour prior, suggesting that the three moderators may have used the data to dump their token holdings.