Reddit has determined to discontinue its blockchain-based Neighborhood Factors reward system, citing scalability challenges and regulatory issues.
Reddit just lately introduced its choice to discontinue its blockchain-based rewards system, Neighborhood Factors. In an official assertion first printed on TechCrunch, Reddit cited the difficult regulatory panorama and points with scalability as main causes for the transfer.
Launched in 2020, the Community Points program was developed as a mechanism to incentivize and acknowledge consumer participation in particular subreddits. Customers might earn these rewards for actions equivalent to garnering vital upvotes on feedback or posts, thereby selling constructive engagement inside communities.
These earned factors weren’t simply digital tallies; they have been represented as ERC-20 tokens and housed in Reddit’s proprietary crypto pockets, the Reddit Vault.
Recipients of Neighborhood Factors had the freedom to make use of them in numerous methods. This included redeeming them for distinctive emojis or badges. As soon as redeemed, these factors can be “burned,” eradicating them from circulation.
In its early days, the Neighborhood Factors program was constructed on the Ethereum (ETH) blockchain. Nonetheless, in a bid to cut back transaction charges and handle scalability issues, it transitioned to Layer 2 Arbitrum Nova in August of final 12 months. Nonetheless, the corporate has determined to discontinue this system.
“Shifting away from Factors permits us to spend money on merchandise that present worth to extra Redditors,” Reddit affirmed in an announcement.
The social media platform emphasised its dedication to innovating and launching new merchandise aligned with the goals the Neighborhood Factors system initially focused. The platform has set a sundown date of Nov. 8 for the whole discontinuation of the service.
