Kraken’s Powell: Reddit Should Offer ‘Redemption Path’ For Community Points

Jesse Powell, co-founder and chairman of the board at the crypto exchange KrakenReddit argued that it should have offered a “redemption path” to owners of its crypto-powered community points.

In a post on Reddit, Powell said, “I personally don't see any regulatory issues,” adding, quoted in Reddit's explanation for “Sunset,” he wrote, “I understand it's complicated and evolving and probably not Reddit.” I want the stress. “

The social media platform said that “the regulatory environment has increased to the limit of scale” for the Community Points program, citing the “restrictive environment” and “overcommitment of resources” as reasons. .

Following the announcement, the value of Reddit's MOON token dropped more than 80%, while BRICK, the token for Reddit's Fortnite community, dropped more than 50%.

Powell said the social media platform's decision “destroys asset value without providing anything in return.” Reddit suggested, “People buy collectible avatars at a certain ratio or something. Turn the points into karma, give people a special badge when you burn them.

What are community points?

Reddit Community Points are ERC-20 tokens originally coined on Ethereum The network, however, later migrated to the Layer-2 network Arbitrum Nova. The tokens can be redeemed for various benefits on Reddit such as badges, emotes, GIFs and other features.

Kraken was one of the few US exchanges that traded Reddit's MOON and BRICK tokens.

Reddit has announced that its Community Points program will be completely shut down as of November 8th. After that, community points will be invisible on the platform.

Additionally, tokens stored in “community tanks” or ecosystem pools will be burned at the end of the year. 40% of the lunar supply is allocated to community tanks.

Reddit's decision to sunset Community Points didn't affect its collection of avatars. Polygon As free or paid NFTs in social media platform. Reddit launched Avatars in July 2022 and has released more than 21 million collectibles in a single dashboard.

Story edited by Stephen Graves.