The cryptocurrency world witnessed a landmark moment on May 15, 2020, when Reddit — one of the internet’s most visited platforms with over 430 million monthly active users — officially introduced a blockchain-based rewards system powered by Ethereum. The initiative, called Community Points, allows users to earn ERC-20 tokens for contributing quality content and participating in discussions, marking one of the first large-scale integrations of blockchain technology by a mainstream social media company.
TL;DR
- Reddit launched Community Points — ERC-20 tokens on the Ethereum blockchain — to reward user engagement
- Two tokens introduced: Moons for r/cryptocurrency and Bricks for r/FortNiteBR
- Tokens are earned through quality posts and comments and can be used for badges and premium features on Reddit
- The cautious design keeps tokens confined to Reddit, avoiding regulatory concerns that plagued Telegram and Facebook
- Legal experts view the tokens as loyalty points rather than investment vehicles
How Reddit’s Community Points Work
The system operates on a straightforward principle: users who contribute valuable content to participating subreddits are rewarded with tokens that live on the Ethereum blockchain. For the initial rollout, Reddit selected two communities — r/cryptocurrency, which received the Moon token, and r/FortNiteBR, the battle royale game’s subreddit, which received the Brick token.
Each month, Reddit distributes Community Points based on the karma users have accumulated from their posts and comments. The tokens are stored in a built-in wallet called the Vault, which gives users actual ownership of their digital assets on the Ethereum network. This represents a meaningful departure from traditional rewards systems, where points remain under the control of the platform.
The Vault operates as a non-custodial wallet, meaning Reddit does not hold users’ private keys. Users have genuine ownership of their tokens, which are recorded immutably on the Ethereum blockchain. This architecture aligns with the core crypto ethos of self-sovereignty and decentralization.
A Strategic Cautious Approach
Reddit’s design choices were clearly influenced by the regulatory headaches facing other social media companies venturing into cryptocurrency. Facebook’s Libra project had drawn intense scrutiny from lawmakers and regulators worldwide, while Telegram was forced to abandon its TON blockchain project the very same week after the Securities and Exchange Commission successfully argued that its GRAM token sale constituted an unregistered securities offering.
By restricting Moons and Bricks to use within Reddit itself — primarily for purchasing badges, emojis, and other community perks — the company sidestepped the most significant regulatory landmines. Preston Byrne, a cryptocurrency authority at the law firm Anderson Kill, characterized the tokens as a form of in-app rewards points, noting that simply putting something on a blockchain does not transform it into an investment product.
A Reddit spokesperson described the initiative as an experiment, emphasizing that the company was working exclusively with two communities to test the feature and gather user feedback. This measured language signaled Reddit’s awareness that even a well-intentioned blockchain project could attract unwanted attention from financial regulators if perceived as straying into securities territory.
The Broader Significance for Crypto Adoption
While some crypto enthusiasts might have been disappointed that Reddit’s tokens were not designed to be freely tradable currencies, the strategic importance of the launch should not be underestimated. With hundreds of millions of users, many of whom had never interacted with blockchain technology, Reddit was effectively introducing cryptocurrency wallets to an enormous mainstream audience.
The choice of Ethereum as the underlying blockchain was also significant. Ethereum’s robust smart contract capabilities and established developer ecosystem made it the natural choice for hosting ERC-20 tokens. At the time of the launch, Ethereum was trading at approximately $195, having recently recovered from a sharp decline alongside the broader market.
The timing was also notable, coming just days after Bitcoin’s third halving on May 11, 2020, which reduced the block reward from 12.5 BTC to 6.25 BTC. The halving had dominated crypto headlines throughout the week, and Reddit’s announcement added to the sense that the cryptocurrency ecosystem was entering a new phase of mainstream engagement and institutional interest.
Challenges and Limitations
Despite the excitement, there were clear limitations to Reddit’s approach. The tokens could not be transferred outside the platform or used as a general-purpose currency, which significantly limited their utility. Some critics argued that this made them little more than a gimmick — blockchain-embellished versions of the karma and gold systems that Reddit already had in place.
Ethereum’s scalability challenges were also a concern. At the time, the network was already showing signs of congestion during peak usage periods, and onboarding millions of Reddit users could theoretically strain the system. The project was initially deployed on the Ethereum Rinkeby testnet, suggesting that Reddit was proceeding cautiously before any mainnet deployment at scale.
Why This Matters
Reddit’s Community Points initiative represented a watershed moment in the relationship between social media and blockchain technology. While the tokens themselves were deliberately limited in scope, the underlying infrastructure exposed millions of ordinary internet users to cryptocurrency wallets, blockchain transactions, and the concept of true digital ownership for the first time. The project also demonstrated a viable playbook for how large technology companies could engage with blockchain without running afoul of securities regulators — a lesson that would prove valuable as more platforms explored similar integrations in the years that followed. Whether Reddit would eventually expand the program to more communities or enable broader token functionality remained an open question, but the foundation had been laid for what many viewed as the beginning of social media’s blockchain era.
Disclaimer: This article was written for informational purposes only and does not constitute financial or investment advice. Cryptocurrency markets are highly volatile, and readers should conduct their own research before making any investment decisions.
reddit putting community points on ethereum is actually massive – 430 million users getting exposure to crypto without even knowing it
moons and bricks are just the start – imagine every subreddit having its own token for governance
this is how mass adoption happens – not through whitepapers but through platforms people already use daily