In a decisive move, Reddit has dismissed two moderators from its r/CryptoCurrency community following allegations of insider trading concerning the Moons (MOON) token. The revelation came to light when it was found that certain wallets linked to the moderators sold substantial amounts of MOON tokens moments before an official announcement on the discontinuation of a blockchain-based rewards program.
On October 18, just before the public disclosure of the program’s closure, three wallets associated with the community moderators sold off MOON tokens amounting to hundreds of thousands of dollars. This activity was flagged by on-chain analysis observers on platform X (previously known as Twitter), including Lookonchain.
The implicated moderators had an hour’s head start on the information regarding the program’s termination. While the announcement saw the token’s value plummet by almost 85% to a meagre $0.0198, these moderators capitalized on their prior knowledge, executing timely sales to secure better profits, much to the detriment of the oblivious wider community.
In its probe into the allegations, r/CryptoCurrency’s core contributor and MoonDust founder, u/mellon, revealed to Cointelegraph that two moderators were shown the door, while three others are still under scrutiny. The moderators in question, u/rider_of_the_storm and u/McGillby, had allegedly sold their MOON tokens ahead of the public disclosure.
The now-discontinued program was a mechanism for community members to earn and spend points through MOON tokens, enhancing user engagement on the platform. Within the r/CryptoCurrency community, active participants could earn MOON tokens, an ERC-20 token, through posting or commenting, which could then be traded, tipped, or utilized for various purposes within the realm.
This incident underscores the ethical considerations surrounding cryptocurrency trading, especially within online communities where trust is paramount. The swift action by Reddit reflects a commitment to maintaining a level playing field, thereby safeguarding the integrity and trust within the cryptocurrency communities it hosts.
Source: https://cointelegraph.com/news/reddit-removes-moderators-alleged-insider-trading-moon-tokens
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