Social media platform Reddit plans to drag the plug on its blockchain-based reward service Neighborhood Factors.
“The regulatory setting has added to scalability limitations. Although the moderators and communities that supported Neighborhood Factors have been unbelievable companions, because it’s advanced, the product is now not set as much as scale,” Reddit wrote in a message reviewed by The Block.
“Transferring away from Factors permits us to spend money on merchandise that present worth to extra Redditors,” it added. “We’ve additionally launched, or are actively investing in, a number of merchandise that accomplish what the Neighborhood Factors program was geared toward.”
Reddit will sundown Neighborhood Factors by Nov. 8.
Reddit’s blockchain ambitions
Neighborhood Factors first launched in 2020 as a solution to reward customers for constructive exercise in sure subreddits, reminiscent of receiving a considerable amount of upvotes for a remark or submit, with the purpose of augmenting consumer engagement and communities.
The factors customers earned have been ERC-20 tokens saved within the platform’s crypto pockets known as Reddit Vault. Redditors may then spend their Neighborhood Factors on perks reminiscent of emojis or badges, after which the factors could be burned.
Although Neighborhood Factors launched on Ethereum, the service migrated to the Layer 2 Arbitrum Nova in August of 2022 to decrease transaction prices and enhance scalability, The Block beforehand reported.