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For large companies, web3 is still in a purgatory of sorts. For every Nike .SWOOSH announcement or NFT-exclusive luxury fashion release, there is a large company that backs off on their plans to enter the space.
I, for one, believe that web3 adoption is inevitable. That’s why I continue to share my thoughts here.
Who else is in this camp? Reddit.
The social media platform does not have the same flashy headlines as some other companies and brands (yet), but their approach is one that should and will be studied in more detail when it comes to integrating web3 capabilities into an existing ecosystem in the future.
What are they doing?
Avatars first launched in August 2022, and Gen 4 will launch tomorrow. There are some eyebrow-raising stats around these avatars:
13.7 million avatar holders
17 million avatars minted
$33+ million in secondary market sales
How are these numbers so high?
Accessibility: Most avatars are under $10, and there were also free collections for users to claim.
Diversity: By partnering with a large range of artists, Reddit has something for everyone.
Product Market Fit: Reddit is primarily an anonymous social platform. As a result, avatars add a dimension to express yourself, your interests, and your personality.
Similar to wallet stats, I would caution how these numbers are referenced. While the dashboard states that there are 13.7 million avatar holders, that probably doesn’t mean 13.7 million people have an avatar or that the same number purchased avatars. That said, this number shows that mass adoption is possible if you don’t scream about NFTs at someone’s face, provide the right incentives, and implement thoughtful positioning.
My Axolotl avatar I got for free. Cute.
Reddit’s Gen 4 release continues to introduce new artist and brand partnerships that spill over into the web3-native space. One of them is Cool Cats which was announced earlier today.
Reddit quietly changed their stance on Community Points (virtual currency awarded to Reddit community contributors) in the Terms of Use.
Original tweet that called this out
Certain communities have been testing their version of Community Points for some time. For example, r/CryptoCurrency launched Moons back in 2020 on Arbitrum, and built incentive mechanisms to reward contributors and provide perks to Moons holders:
Moons are distributed every 28 days based on the share of user’s karma earned in the subreddit
Moons can be used as an additional form of tipping between users for their contributions
Moons can be won from community events like community trivia and prediction contests
Community Points were officially announced back in August 2022, and we’re starting to understand what can be done with them.
Last week, Carly Reilly from Overpriced JPEGs released an episode with some members of the Reddit team.
Highlights:
The Reddit team identified that there was a strong product market fit around identity and avatars. This is in contrast to other social platforms like Instagram, where users are more likely to be doxxed.
NFTs have a speculative nature to them. However, Reddit has a strong community-oriented foundation so they have not seen the same aggregate level of peaks and crashes that many other NFT collections have experienced. This is also one of the reasons why secondary market volume is relatively low — Reddit Avatars are rooted in community vs. money.
The initiative has included some large brand partnerships with the NFL and Ubisoft. I imagine there will be more to come.
Reddit’s core thesis around web3 is being confirmed. It may take years to be fully realized, but they believe that:
People enjoy owning things
People enjoy expressing themselves
People like cool art and they support artists they like
Web3 is the best way to enable the above
Nothing better than getting thoughts from the team directly!
Do you own something? If so, share or subscribe!
While poking around Reddit researching this piece, I came across a post from venkman01 a couple weeks ago, around the same time the Terms of Use was updated.
The title? Reworking Awarding: Changes to Awards, Coins, and Premium
TLDR:
Coins and awards on Reddit will be sunsetted starting September 12, 2023
Awards were used as a way to recognize contributions to fellow Redditors, but there were two consistent pieces of feedback from users over the years:
Rewards felt cluttered (over 50+ types of awards)
Redditors wanted awards to be more valuable for the recipient
The team wants to make Reddit a place where the community empowers the community more directly
Despite the deprecation of awards and coins, rewarding good content will still be a part of Reddit
More details will be revealed in the coming months
So what’s going to happen?!
I’m not a betting man (jk I am when I’m in Vegas or when it comes to animal PFPs sometimes…), but if I were going to, it seems like Reddit will be rolling out Community Points across the platform.
This notion is bolstered by one of the points from the Moons wiki page in their use case section. Moons can be used to:
Vote on Governance Polls that influence community governance and Moons distribution
Rent banner space as a form of advertising
Purchase a special tier of membership that allows for additional features like custom emotes and using GIFs in comments
Show proof of reputation and contribution
Be a form of value off Reddit since these are interoperable ERC-20 tokens
On top of that the term ‘token’ is mentioned multiple times on the Community Points page. Moons is an exception today, and will be the norm in several months.
If we take a step back, we see an effort that was over a year in the making (even longer if we factor in when the team started working on this internally). Using the same visual I introduced last October, Reddit’s web3 vision largely remains the same:
The ecosystem piece is interesting because seems to take value away from Reddit, but it actually creates a stronger engagement loop back to Reddit if executed well.
For potential partners, the allure is user acquisition. By accepting a Reddit community’s token as a form of value exchange, these partners have access to communities that are millions of members strong. Assuming the largest communities launch Community Points:
What if Ticketmaster launched a promotion for a free ticket to a comedy show (max value of $20) to r/funny (51 million members) and Jokes (26 million members)?
What if Twitch launched a promotion for a free month’s subscription to any gaming streamer to r/gaming (38 million members)?
What if Chewy launched a promotion for a $50 promo code to r/aww (Animals and Pets subreddit, 34 million members)?
The possibilities are not only endless, but become more clear as a marketing and user acquisition strategy. Because you’re accepting Community Point tokens as a form of value exchange (not a random promo code you can find online), you’re targeting users that are engaged in that topic and are providing valuable content to that topic’s community. These are the types of users you want if your job is to make number go up.
Reddit understands the power of communities and how web3 empowers them further.
After all, community is one of the foundations that this space was built upon 😉
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