I saw this piece of news and is quite surprised no one seems to be talking about it on Hive yet. Reddit is introducing the concept of "community points" in the form of ERC-20 tokens to their subreddit. The beta will start with the /r/Cryptocurrency and /r/FortniteBR subreddit with the $MOON and $BRICKS tokens respectively.
Source for this screenshot and all subsequent ones
How Community Points work?
Community Points are rewards
The very first thing Reddit mention about when answering what are Community Points, is that these points are rewards.
People earn Points by contributing to the community, for example by submitting quality posts and comments. Based on these contributions, the community ultimately decides how many Points each person receives.
Sounds familiar?
Community Points are cryptocurrencies
Next, Reddit also implies that Community Points are cryptocurrencies. Though they do not mention it directly, it is clearly implied when they draw parallel with Bitcoin and from these descriptions,
Again, these features are somewhat similar to what we have on Hive.
Community Points represent influence
Reddit also mention that the points represent reputation and voting power.
Though the voting and reputation system is quite different from what we have here on Hive, it is of the same idea that having more points means having more influence. Likewise on Hive, having more HIVE or Hive Power means more influence.
A different way of distribution
The way Community Points will be distributed is very different from Hive though.
It seems that Reddit wants to allow the communities to have the final say as to how the points are distributed each month. This is very different from the system we have here on Hive.
Another interesting thing is that Reddit is capping the points for each community at 250 million with a mechanism to ensure that points can be re-circulated.
A threat to Hive?
Most people know about Reddit and have probably visited Reddit before as it commonly shows up in search results. Their slogan claims that they are the "front page of the internet". They have 330 million active users, $100 million annual revenue and the site is ranked number 19 on Alexa rankings. We know Hive is a fork of Steem, and when Steem started, the first application/interface is called Steemit as a direct challenge to Reddit. Years have passed but we are nowhere near.
All this while, Hive (or Steem) had a key differentiating factor when compared to Reddit, which is that we can earn cryptocurrencies on Hive but not on Reddit. However, this seems to be changing with this new feature from Reddit. If this takes off, it is certainly going to challenge the relevance of Hive. If these tokens also have a market for them to be traded, this will mean you can also earn by contributing content on Reddit. When that day comes, will someone new prefers to join Hive or write on Reddit? Will existing Hivers move to write on Reddit instead?
Or is it an opportunity?
If we flip our perspective, this new feature may be an opportunity for Hive. One common skepticism Hive often gets is that it is a ponzi scheme. How do you get rewarded just by writing stuff? Isn't money printed from thin air? Who is paying for all this?
Such skepticism is understandable on a platform so small like Hive (or Steem). But when a large and reputable platform does it, it will be greeted differently. However, the underlying concept is the same. It doesn't take Reddit a lot of money to mint the tokens since they are minted from thin air. All they did is to spend time creating this feature on their platform. So isn't this what Hive has been doing all this while?
So if this concept can be proven on Reddit, perhaps more people will start to believe in it. Naturally, one way or another, it may lead some people to Hive.
Ethereum is still a winner regardless
Reddit is platform trying to bootstrap a cryptocurrency with their existing user base, while Hive/Steem are trying to bootstrap a user base with their cryptocurrencies. Only time will tell who will be the ultimate victor. However, at this point, it seems that Ethereum is going to be a winner regardless.
Since the tokens are ERC20 tokens and operate on the Ethereum blockchain, it is clear that Ethereum will benefit from this in the long run. Not only does it get more people to know about Ethereum, it is going to cause the number of Ethereum wallets to explode. This is going to have a strong positive network effect on Ethereum in the longer run.
It is also interesting to see so many so-called Ethereum killers available but Reddit still chose to have these tokens issued as ERC20 tokens.
What are your thoughts about Reddit issuing ERC20 tokens for their subreddits? Do you think it is a threat for Hive or is it an opportunity?
This article is created on the Hive blockchain, an immutable and censorship-resistant content platform.
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