Reddit’s r/CryptoCurrency has fired a group of moderators who allegedly carried out insider trading of MOON tokens, ultimately causing an 85% drop in the token’s price.
Last Tuesday, Reddit made an announcement revealing its decision to terminate the ‘Community Points’ program citing scalability issues.
Designed to reward creators and developers, users could earn and spend community points through native tokens through this blockchain-based internet points program.
$MOON is an ERC-20 token that is distributed to users of the social media platform Reddit. This can be done in part based on the number of upvotes that a posts receive, along with being freely traded, tipped, or spent in the community for different purposes.
However, some 30 minutes before the official announcement of the sunsetting, a group of moderators traded the token in bulk. As per data tracked by Lookonchain, they sold 456,353 $MOON tokens, valued at $92,000. This was followed by another chunk of 363,227 MOON tokens hitting the market.
As a repercussion of this selling pressure, $MOON’s value plummeted by over 85%, taking it to trade at a low of $0.0198.
The moderators were informed of the termination of the program about one hour before the announcement, as per r/CryptoCurrencyMoons subreddits. The insider trading enraged the many in the investor community, highlighting a lack of level playing field on Reddit.
While some questioned Reddit’s decision to inform moderators in advance, others called for regulatory action against them as removing them from the team was not acceptable.
The r/CryptoCurrency subreddit is currently in the process of figuring out how to go about the issue while considering the future of the MOON token.
In one of the post, it stated: “There is a proposal to solve the situation by u/mellon98 – core contributor and MoonsDust’s founder, and we’re brainstorming about Moons’ future — waiting for Reddit’s decision on whether they’ll transfer the contract to us or a burn address.”
Nevertheless, the community expressed its commitment to the MOON community token saying that no matter what the outcome is, “Moons are here to stay”.
Meanwhile, a post made by ‘CryptoMods’ also expressed their stance on the issue saying: “We plan to continue with Moons independently, whether that be through taking over smart contract ownership (if possible), or airdropping a new token 1:1 with current balances. What the solution will be is currently up in the air and dependent on Reddit coming to an internal decision, but we are happy to discuss this with the community and come to a decision together on how to move forward.”
At the time of press, $MOON was down by over 4% in the last 24 hours. It is currently changing hands for $0.03425, struggling in the red on its charts.
