Reddit Crypto Community Removes Moderators Accused of MOON Insider Trading
In a recent controversial move, the Reddit community r/CryptoCurrency, boasting a whopping 6.9 million users, has decisively ousted moderators implicated in the insider trading of the subreddit's native token, MOON. This drastic step was taken after the revelation that these moderators traded the token mere minutes prior to Reddit’s official declaration of terminating its “Community Points” program last Tuesday.
“All the moderators who sold Moons before the announcement have already been removed from the mod team,” r/CryptoCurrency informed CoinDesk via a Twitter message, showcasing their swift and stringent action against the alleged wrongdoing.
The timeline of events unfolds as follows: on Tuesday at 13:02 EST (17:02 UTC), Reddit pulled the plug on its community points initiative, attributing the closure to scalability hurdles. This blockchain-powered program was initially conceptualized to acknowledge and reward the efforts of creators and developers, facilitating the earning and spending of community points via native tokens such as MOON.
A crucial piece of the puzzle emerges 30 minutes prior to this announcement. Utilizing their access to insider information about the impending news, a select group of moderators offloaded a staggering 456,353 MOON tokens, valued at a substantial $92,000 at the time, data from onchain sleuth Lookonchain reveals. Adding fuel to the fire, another substantial batch of 363,227 MOON tokens was traded just two minutes before the official Reddit statement, exacerbating the selling pressure.
As a brief overview, MOON is an ERC-20 token, designed to be a reward for Reddit users contributing posts or comments in the r/CryptoCurrency subreddit. Users are at liberty to trade, tip, or use these tokens for various community-based activities. In the aftermath of Reddit's announcement, the value of MOON plummeted by over 85%, hitting a low of $0.0198.
The incident raised eyebrows and ire within the investment community, sparking a heated debate and calls for stringent regulatory action against the implicated moderators. There were also questions and criticisms directed at Reddit’s decision-making process, particularly their choice to brief the moderators an hour before the public announcement.
“Those who sold before the announcement should be reported to the SEC. Removing one's self isn't an acceptable outcome for insider trading,” user Bucksaway03 voiced out on the platform, calling for accountability and repercussions.
“At least everyone would have been on the same playing field if Reddit just blindsided everyone, including the mods," pointed out Lord-Nagafen, highlighting the fairness aspect of the situation.
In the wake of this turmoil, the r/CryptoCurrency subreddit is now engaged in intensive discussions and brainstorming sessions, contemplating the future trajectory of the MOON token.
"There is a proposal to solve the situation by u/mellon98 – a core contributor and founder of MoonsDust. We're actively brainstorming about Moons' future, and we are awaiting Reddit's verdict on whether they will transfer the contract to us or to a burn address," stated r/CryptoCurrency, indicating their proactive stance and commitment to resolving the issue.
The removal of the moderators implicated in the MOON insider trading scandal marks a significant moment in the history of the r/CryptoCurrency community. It underscores the challenges faced in regulating and maintaining fairness in the volatile and often unpredictable world of cryptocurrency. As the community grapples with the fallout and seeks solutions, this incident serves as a stark reminder of the need for transparency, accountability, and stringent oversight in the digital asset space. The r/CryptoCurrency community, while shaken, remains resilient and determined to navigate through these turbulent waters, showcasing a steadfast commitment to upholding integrity and fostering a fair and equitable environment for all its users.
