FTX brings crypto exchange to Reddit

In the latest instance of FTX embarking on a massive bear market buying spree, the crypto exchange has struck a deal with Reddit.

Crypto-to-fiat exchange platform FTX Pay is integrating with Reddit and Arbitrum to allow users to pay gas fees on Reddit’s “Community Points” tokens using fiat. Community Points, rolled out in 2020, are blockchain-based Reddit tokens that allow users to share rewards and interact with the social platform

Reddit is a platform of choice for private crypto investors — crypto was the platform’s most viewed topic in 2021. In July 2021, aggregation solution Arbitrum won a competition to build an Ethereum pool for community points, and now the digest is launching on the Ethereum mainnet. , the company said on Tuesday.

Community points allow subreddits to reward active members or make governance decisions.

Like all layer-2 digests, Community Points transactions are settled on Ethereum, and Reddit enlisted the expansion-minded FTX to allow users to pay Ethereum’s transaction fees with fiat.

“Users need Eth for gas fees to trade with Community Points on chain, and FTX Pay allows them to do that,” Amy Wu, head of FTX Ventures, said in an email.

Community Points are currently only live ir/cryptocurrency and r/fortnite subreddits, although Reddit has a waiting list. Reddit airdrops point to active users – the same way users receive “Karma” for upvoted posts.

Top contributors ir/cryptocurrency earned 3,774 “Moons” tokens last month, or about $340 at current secondary market prices. A Reddit spokesperson said Community Points are only intended for community management and “reputation points” on Reddit, adding that selling tokens is against the site’s terms of service.

Steven Goldfeder, CEO of Offchain Labs, the developer behind Arbitrum, told Blockworks that he hopes to see new use cases emerge around Reddit’s crypto tokens.

“We have the whole structure and security mechanism built out, but we also allow others to develop in this ecosystem,” Goldfeder said. “It’s not just Reddit that launches Community Points. Others can take advantage of it. For example, a game developer can go ahead and say, ‘I’m launching a game and the currency in my game is these Reddit Community Points.’

Reddit’s crypto integration marks the latest instance of a Web2 company buying into Web3 technology, following Instagram’s expansion of NFT integration last week.

“Reddit has a huge community,” Goldfeder said, “How do you get a billion users on the blockchain? It’s by tapping into these existing communities and bringing them to the blockchain.”

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