The r/CryptoCurrency community, which has 6.9 million users on Reddit, recently came to the fore with an altcoin scandal. Accordingly, the subreddit made headlines with a scandal involving insider trading of its native token, MOON. Shortly before Reddit officially announced that it was ending its “Community Points” program last Tuesday, moderators sold a significant amount of MOON tokens. These moves led to their dismissal.
Reddit’s altcoin-focused community points program
Reddit’s “Community Points” program used blockchain technology to reward creators and developers. It allowed users to earn and spend community points. Additionally, altcoin MOON tokens were the local currency. However, Reddit cited scalability issues when announcing the termination of the program.
An interesting situation emerged in the 30 minutes before the official announcement. Accordingly, the moderators, who had prior knowledge of the upcoming decision, took a step. Accordingly, they sold 456,353 MOON tokens worth $92,000 at that time. Just two minutes before the official announcement, 363,227 more altcoin MOON tokens entered the market, increasing the selling pressure.
MOON token
MOON, an ERC-20 token, was distributed to users as a reward for their contributions to the r/CryptoCurrency subreddit. It can be bought and sold within the community. Additionally, tips can be given or spent. However, in response to Reddit’s decision, altcoin MOON fell over 85% to $0.0198.
This has presented challenges with regulating Bitcoin and altcoin markets, especially in online communities. Many in the investing community have expressed outrage over insider trading. Some called for regulatory action against moderators. Others, however, questioned Reddit’s decision to notify subreddit leaders in advance.
There is a request for legal action
A user named Bucksaway03 provides an interesting suggestion. Accordingly, he demands legal action. In his statement, he said: “Those who sold before the announcement should be reported to the SEC. Self-destruction for insider trading is not an acceptable outcome.” He emphasizes. The incident sparked discussion in the r/CryptoCurrency community regarding the future of the altcoin MOON token. Key participants and founders suggest potential solutions. On the other hand, they are waiting for Reddit’s decision on whether to transfer the token’s contract or create a burn address.
When we look at it as Kriptokoin.com, this incident attracts extremely attention. On the other hand, it serves as a cautionary tale about the challenges of maintaining integrity and transparency in cryptocurrency communities. Accordingly, it highlights the potential consequences of insider trading.
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