Reddit is experimenting with cryptocurrency, and though it’s currently only a trial, it might turn out to be one of the most important developments in the space.
The social news site launched a new feature called Community Points, which are earned by submitting quality content and can be spent on premium features such as badges and emoji (as well as being used for bragging rights). This, in itself, isn’t new for Reddit, but these new Community Points are essentially cryptocurrency tokens built on the Ethereum network.
Ethereum, which is both a cryptocurrency like Bitcoin and a platform for decentralized apps, has a standard called ERC-20 that allows for simple creation of new cryptocurrencies called tokens. These have all the basic properties of Ethereum itself — namely, they’re near-impossible to counterfeit, and they are fully controlled by their owners. This means that, once the tokens have been created and transferred to a user, not even Reddit can take them back.
“Your Community Points exist on the blockchain, independently of Reddit, where they can only be controlled by you (just like Bitcoin!). Neither Reddit nor moderators can take your Points away or decide what you do with them,” says Reddit in an FAQ explaining the new feature. Also, when you spend them, the “Points are ‘burned’ (destroyed). This makes everyone else’s slice of Points larger, thus rewarding the entire community.”
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