Reddit’s Crypto Subreddit Ousts Moderators Over Alleged MOON Insider Trading
In Brief
Reddit’s r/CryptoCurrency ousted moderators for trading the MOON token before a program’s termination announcement.
In a turn of events that has left the crypto community stunned, Reddit’s r/CryptoCurrency subreddit has ousted several moderators. They allegedly traded the subreddit’s native MOON token mere minutes before Reddit announced the end of its “Community Points” program.
Last week, Reddit shut down its blockchain-based “Community Points” program, designed to reward creators and developers. A significant feature of this program was its enabling users to earn and redeem community points using tokens, particularly the MOON token.
Alarm bells started ringing when onchain data analysts, Lookonchain, noticed suspicious trading activity. About 30 minutes leading up to Reddit‘s announcement, insiders, presumed to be the moderators with prior knowledge of the forthcoming news, allegedly liquidated 456,353 MOONs, which equated to a value of $92,000 at that time.
Just two minutes before the announcement, someone sold another large lot of 363,227 MOONs, adding more pressure to the sell side of the market.
Reddit’s Reaction
MOON, an ERC-20 token, rewards active users in the r/CryptoCurrency subreddit for their posts and insightful comments. Post the Reddit revelation, the token’s value plummeted by an astonishing 85%, coming down to $0.0198.
Reddit rugged its crypto community.$MOON -88% https://t.co/Qp3JaokaFH pic.twitter.com/TBQUHSihnC
— Ignas | DeFi Research (@DefiIgnas) October 17, 2023
While insider trading is a contentious issue in traditional markets, it’s even murkier in the decentralized world of cryptocurrencies. This incident underscores the pressing concerns and complexities in monitoring and regulating crypto trading activities. For context, moderators were reportedly tipped off about Reddit’s forthcoming move an hour before the official announcement.
This alleged insider trading has sparked fury and intense debate amongst investors and community members. Some are demanding strict regulatory intervention against the accused moderators, while others are questioning Reddit’s decision to give them a heads-up in the first place.
In light of these events, the future of the MOON token is hanging in the balance. The r/CryptoCurrency subreddit is in discussions about the token’s direction, with one user, u/mellon98, putting forth a potential solution. The community is now in anticipation, awaiting Reddit’s decision on whether they’ll hand over the contract or designate it to a burn address.
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About The Author
Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
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Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master's degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.
