Reddit’s influential social networking site is in the headlines today, after confirming a collaboration with the Ethereum Foundation, with the development of Reddit’s first-ever blockchain partnership.
The purpose behind it is to speed the scaling process and capital for the Ethereum ecosystem and introduce the utility of blockchain technologies to Reddit’s population of over 50 million active users a day. According to Reddit admin u/jarins who made an announcement to the Ethereum subreddit,
“In this new stage of our partnership, immediate efforts will be focused on bringing Ethereum to Reddit-scale production.”
In reality, the partnership with Ethereum dates back to the last year when Reddit launched Group Points, a function based on the Ethereum network. This functionality is currently being tested in r/CryptoCurrency and r/FortNiteBR, subreddits where users award each other for “quality posts” which are then deposited in the Ethereum Rinkeby testnet as ERC-20 tokens.
According to many, this step may contribute to more acceptance for Ethereum by the Reddit group and be extremely bullish for ETH in the long run.
Interestingly, when Community Points were first rolled out on Reddit, popular Ethereum proponent Ryan Sean Adams had commented on Twitter that “Ethereum is the Internet’s property rights system.”
Since Community Points are DeFi compatible ERC-20 tokens, he had also posited that this could significantly increase DeFi’s user growth.
On the contrary, several others rejected these arguments, particularly because the knowledge of DeFi is restricted to just a few people within the crypto-space itself, let alone Redditors.
Furthermore, DeFi also has significant problems with respect to interoperability and liquidity, all of which desperately need to be rectified before it could potentially target the mass industry or conventional consumers.
Whether or not this should be linked to Reddit or not, the fact is that the TVL in DeFi rose from $825 million at the time of the launch to over $25 billion at press time.
Ethereum is currently scaling to the Layer 2 POS network. Before proper Layer 2 solutions are in operation, the ability of Ethereum will remain considerably constrained and it is unlikely that it will be able to support the entire Reddit user base of more than 400 million users.
The second-largest market cap cryptocurrency just made headlines since reaching a fresh all-time peak, with crypto breezing past $1,473 earlier this week.
Reddit was also blamed for the frantic surge in GameStop and other stock values in the news lately after fast transactions by buyers on a sub-reddit named WallStreetBets.
448 Interactions, 2 today
Earlier this month, a little-known Reddit collective called WallStreetBets rocked the conventional market. In fact, its influence was felt even Read more
The major hitters in traditional finance became nervous about the recent capital market activity fueled by Redditors and a vast Read more
Last week, more than 200,000 Redditors entered the page. One of the most well-known online groups of Bitcoin reached two Read more
Fearing that new delistings and uncertainty are "undermine market confidence," the U.S. securities regulator says it is looking into the Read more