What to expect from Reddit’s partnership with the Ethereum Foundation?
Popular social media platform Reddit is in the news today after it announced a partnership with the Ethereum Foundation, with the development establishing Reddit’s first-ever blockchain partnership.
The goal behind the same is to accelerate the scaling process and resources for the Ethereum ecosystem and bring the value of blockchain technology to Reddit’s community of over 50 million daily active users. According to Reddit admin u/jarins who made the announcement on the Ethereum subreddit,
“In this new stage of our partnership, immediate efforts will be focused on bringing Ethereum to Reddit-scale production.”
In fact, the collaboration with Ethereum dates back to last year when Reddit introduced Community Points, a feature that was built on the Ethereum network. This feature is currently being tested in r/CryptoCurrency and r/FortNiteBR, subreddits where users reward each other points for “quality posts” which are then stored in Ethereum’s Rinkeby testnet as ERC-20 tokens.
According to many, this move can drive further adoption for Ethereum from the Reddit community, and be incredibly 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, there were many others who disputed these claims, especially since the knowledge of DeFi is limited to only a few people within the crypto-space itself, let alone Redditors.
Further, DeFi still has major issues with regards to interoperability and liquidity, all of which need urgent rectification before it could possibly target the mainstream market or traditional users.
Whether or not this is can be attributed to Reddit or not, the fact is that the TVL in DeFi grew from $825 million at the time of that announcement, to over $25 billion, at press time.
Ethereum is currently in the process of scaling to a Layer 2 POS network. Until proper Layer 2 solutions are in play, Ethereum’s capacity will remain considerably limited, and it remains unlikely that it will be able to handle the entirety of Reddit’s user base of over 400 million users.
The second-largest cryptocurrency by market cap recently made headlines after it hit a new all-time high, with the crypto breezing past $1,473 earlier this week.
Reddit too has been in the news of late after rapid buying by investors on a subreddit titled WallStreetBets was responsible for the frenetic surge in GameStop and other stock prices.