Well-liked social community platform Reddit introduced the winddown of its blockchain-based neighborhood factors program on Oct. 17, citing scalability points. The announcement created controversy within the crypto neighborhood, with many calling it a rug-pull, as the worth of the native token on completely different subreddits tanked after the information was revealed.
Every 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. Customers might spend these factors on badges and unique objects for his or her avatars.
On the time of the announcement, the moderators of many of the subreddits concerned with the neighborhood factors program claimed to be unaware of the choice. Nevertheless, 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 earlier than the announcement.
Associated: Reddit neighborhood tokens soar on Kraken itemizing
On-chain analysts reminiscent of Pledditor had 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 completely 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.
.@Reddit admins informed /r/CryptoCurrency moderators beforehand, and three moderators bought $MOON tokens on insider data$MOON value dropped -22% minutes earlier than the announcement was posted
Here’s a listing of Reddit moderators appearing on inside data BEFORE the announcement: pic.twitter.com/xAh75hOVEa
— Pledditor (@Pledditor) October 18, 2023
In one other incident, simply 17 minutes earlier than Reddit’s assertion, moderator u/Rider_of_the_storm allegedly shifted 345,422 MOON, price over $69,000 on the time, to an change deal with. The Reddit account in query has since been deactivated. In line with Lookonchain, on-chain knowledge confirmed that no less than three of the directors overseeing the cryptocurrency subreddit liquidated tokens some 20 to half-hour earlier than the announcement went public.
1/ Three @CCMOD_ moderators dumped $MOON prematurely through #inside data from @Reddit admins. pic.twitter.com/ucrPkh6siX
— Lookonchain (@lookonchain) October 19, 2023
A press release from the Reddit moderators clarified that they acquired the discover concerning the termination of the neighborhood factors program an hour prior, suggesting that the three moderators might have used the knowledge to dump their token holdings.
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