Shalini Nagarajan

Reddit co-founder Alexis Ohanian was tipped off to the impending launch of Ethereum’s native token, ether, in a meeting with crypto exchange Coinbase back in 2014.



In a recent interview, Ohanian said he spent $15,000 to buy 50,000 ETH (average price: $3.33) in 2014, which is now worth $82.4 million. 



Ether was purchasable for bitcoin in 2014 during the project’s presale, but the Ethereum blockchain only went live on July 30, 2015. This meant the first ether holders had to wait until the blockchain’s launch to move or utilize their tokens.&nbsp;



“In hindsight, I didn&#8217;t invest nearly as much as I should have,” Ohanian told Forbes. Ether was last trading around $1,650, and is up 38% in the year-to-date period, according to <a href="https://blockworks.co/price/eth" target="_blank" rel="noreferrer noopener">Blockworks Research</a>, and 49,500% above Ohanian’s initial purchase price.



Ohanian’s openness to decentralized and uncensorable currency comes from knowledge about his family’s traumatic history, where some of his relatives were killed during the Armenian genocide of 1915. Their inherited heirloom rugs were seized by Turkish soldiers.



The idea of persecution, especially by a state, “makes the idea of a store of value that is not controlled by any single state very attractive,” he <a href="https://www.forbes.com/sites/michaeldelcastillo/2023/02/21/reddit-co-founders-quest-for-unseizable-property" target="_blank" rel="noreferrer noopener">said</a>.



That observation makes up one of Ohanian’s core investment strategies. The tech entrepreneur and venture capitalist has made a total of 164 investments, according to <a href="https://www.crunchbase.com/person/alexis-ohanian" target="_blank" rel="noreferrer noopener">Crunchbase</a> data.&nbsp;



Among those, 29 are blockchain-related. And In February last year, his VC firm Seven Seven Six <a href="https://blockworks.co/news/fundraising-wrap-over-800m-in-investments-poured-into-crypto-this-week" target="_blank" rel="noreferrer noopener">raised $500 million</a> to focus on more such startups.



Ohanian also made an early investment in Coinbase, from which he reportedly gained $50 million. Part of those proceeds went into buying a 17-carat diamond engagement ring for his tennis superstar wife Serena Williams.&nbsp;



<h3>Bitcoin led Reddit co-founder to ether</h3>



Ohanian was already taken by bitcoin’s complexity as a technically unseizable financial instrument.&nbsp;



So, Ethereum was considered an equally good investment opportunity. He recognized the underlying blockchain’s potential for developing additional unseizable assets, such as non-fungible tokens (NFTs) that now have far-reaching use cases in several different industries.



Ohanian reportedly personally owns about 700 NFTs stored on a marketplace, some of which give him early access to one of his VC investments, <a href="https://www.tubefilter.com/2021/11/30/alexis-ohanian-invests-in-nft-startup-islands/" target="_blank" rel="noreferrer noopener">Islands</a>.&nbsp;



Additionally, he holds NFTs giving him ownership rights to real estate property in Georgia and to the Ethereum Naming Service.&nbsp;



In August 2021, about a year after stepping down from the Reddit board, Ohanian spent ether which would be worth $550,000 today on seven NFTs that he believed resembled his wife, including CryptoPunks. 



Updated Feb. 24, 2022 at 9:53 am ET: Corrected reference to Ohanian&#8217;s family history.



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Reddit Co-founder Wishes He Bought More Ether in 2014 Presale

Bessie Liu

Reddit’s native cryptocurrency moons (MOON) has, well, mooned over the past month.



Currently trading at $0.13 per token, the cryptocurrency has soared by about 73% since the start of the year, <a href="https://www.coingecko.com/en/coins/moon" target="_blank" rel="noreferrer noopener">data</a> from CoinGecko show, with the caveat that there are few markets where it trades and liquidity is miniscule. 



Moons is a token built on Ethereum’s blockchain that powers the<a href="https://www.reddit.com/r/CryptoCurrency/" target="_blank" rel="noreferrer noopener"> r/Cryptocurrency </a>subreddit — an online forum for crypto enthusiasts to discuss — and, often, debate — their favored digital assets and related protocol projects. It’s also evolved into an industry hub to share notable news, often as emerging information impacts a token’s price and market capitalization.



Participating Redditors are rewarded with moons tokens, and the token is stored in the social platform’s in-house digital asset wallet.



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<h2>Moons&#8217; use cases </h2>



Moons can be used for a variety of purposes on Reddit, including the purchase of a membership to the r/Cryptocurrency forum for 466 moons a month. Subscribers also receive four new loyalty badges monthly and can include gifs in comment threads. 



The moons token also allows users to partake in polls and tip their peers on content shares, generally those perceived to add value for industry participants.



A Reddit user who wished to remain anonymous told Blockworks that they don’t recall when or why they opened their Vault on Reddit, but it was likely due to the fact that “it was there.”



The user said they have used the cryptoassets on a couple of occasions to tip helpful users. Reddit’s nascent crypto tipping mechanism adds an extra incentive for savvy posts on the forum in particular, they said.



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Another user, <a href="https://www.reddit.com/user/No_Scientist_7094" target="_blank" rel="noreferrer noopener">No_Scientist_7094</a>, told Blockworks that they view the token as similar to the Basic Attention Token (<a href="https://blockworks.co/price/bat">BAT</a>) — a blockchain system designed to reward users for their attention on websites via the web browser Brave, a popular pick for digital assets advocates concerned with digital <a href="https://www.coindesk.com/tech/2021/05/13/brave-integrates-crypto-blockchain-domains-expanding-access-to-web-30/" target="_blank" rel="noreferrer noopener">privacy</a>.



On Web2 platforms, if a user looks at ads, the company often pockets the ensuing revenue. But with the introduction of moons on Reddit, the user credited for bringing eyeballs onto the screen would earn money, they said.



“It&#8217;s a revenue sharing scheme…I hope it will expand and other platforms will use a similar setup,” they said.&nbsp;



No_Scientist_7094 said that the emerging ecosystem could also be used as pocket money, though they personally had yet to sell any of their tokens — and were not looking to do so for a long time.&nbsp;



“I just tip some here and there and use it to vote on new proposals,” they said.



<h3>Reddit&#8217;s r/Cryptocurrency succeeding where rivals failed  </h3>



The Reddit user <a href="https://www.reddit.com/user/Mr_Bob_Ferguson" target="_blank" rel="noreferrer noopener">Mr_Bob_Ferguson</a> told Blockworks that he had contributed to a slew of internet messaging boards, forums and platforms since the 90s. And there had never been an expectation for financial rewards until moons came along.



Despite other subreddits having attempted something along the same lines —&nbsp; and failed (BRICK is a prime example), the reward system has managed to pick up steam.&nbsp;



“Use-cases for moons are slowly building, beyond the initial ‘sub governance voting power,’ through to a new Moonplace.io site, and many are hopeful that Reddit will provide further official integration, such as allowing moons to be used to purchase the popular Reddit Limited Edition Avatars (NFTs) in the future on a marketplace,” he said. 



Companies are also using moons to pay for banner advertising and AMAs (ask me anything) in the sub, he said. “These payments are not insignificant, costing several thousand dollars.”



Moons tokens <a href="https://www.coingecko.com/en/coins/moon" target="_blank" rel="noreferrer noopener">currently</a> have a market cap sitting around $15 million, and Mr_Bob_Ferguson remains optimistic on the potential for the cryptocurrency to continue on its upward trajectory. 



<h2>One downside: ‘moons-farming’</h2>



Although the sentiment around the moons ecosystem has mostly been positive among Reddit community members, users said the token’s introduction also added more fuel to the fire of so-called “moons-farming” behavior.



The practice entails commenting merely for clout’s sake, rather than to contribute to advancing thoughtful discussion contributions.



“The Reddit voting system often doesn’t reward the highest effort content, but instead often low value content that follows a certain narrative,” Mr_Bob_Ferguson said. “For example, after the recent FTX collapse a simple comment of “they should be in jail” would always be rewarded more than a detailed, well thought out, reply.”



Even so, he said, the introduction of moons has upped his own personal engagement on r/Cryptocurrency.



“It is a highly unique way of rewarding users for content,” he said. “It feels as though this type of model may be the future for contributing on social networks.”



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Reddit’s Crypto Moons Upvote a 73% Surge in 2023

Jack Kubinec

As tech executives are forced to account for <a href="https://cms.blockworks.co/big-tech-trading-like-bitcoin-on-a-bad-day-after-disappointing-earnings/">tumbling revenues</a> to investors, a new scapegoat has emerged: crypto.



Philipp Schindler, Google’s chief business officer, <a href="https://cms.blockworks.co/google-summer-ad-business-falls-after-crypto-winter/">blamed</a> the company’s growth slowdown in part on a drawdown in ad spending by crypto companies during a third quarter earnings call.&nbsp;



Semiconductor company AMD similarly <a href="https://www.theverge.com/2022/11/1/23435504/amd-q3-2022-earnings-profits-revenue-pc-sales">pegged</a> its own revenue disappointment, among other things, on falling demand for graphics processing units (GPUs) that can be used to mine crypto. Revolut, the upstart finance app, <a href="https://www.bloomberg.com/news/articles/2022-11-02/revolut-crypto-revenue-plunges-yet-ceo-storonsky-still-believes">said</a> crypto revenue fell from 30-35% to 5% of the company’s total since 2021.



Crypto has reached a milestone in its institutional adoption journey that most in the space would be happy to detour around.



“This is the first real quarter where you&#8217;re hearing these companies actively bringing up crypto as a reason for missed revenues,” Griffin McShane, head of insights and communication at MPCH Labs, said.



But crypto companies had to become intertwined with other tech companies for this revenue shortfall to happen in the first place.



In 2018’s crypto winter, Google was <a href="https://www.cnbc.com/2019/02/04/alphabet-earnings-q4-2018.html">exceeding</a> earnings expectations, regardless of whether crypto companies were purchasing ads. But as venture capital and talented young coders created excitement around the potential of blockchain, the rest of the tech economy had no choice but to shift toward crypto. In 2022, crypto and tech prices <a href="https://cms.blockworks.co/crypto-is-more-correlated-with-tech-stocks-than-ever-how-do-we-decouple/">tend to move in tandem</a>.&nbsp;



“If you&#8217;re running a profit-focused [tech] operation, you have to be supportive of blockchain and digital assets, because that seems to be where we are going,” David Tawil, CEO of ProChain Capital, said.



Crypto’s move to the mainstream has been fragmented and beset by unimpressive trading returns in 2022. Bitcoin mining, the original crypto-tech integration, was <a href="https://bitinfocharts.com/comparison/bitcoin-mining_profitability.html#1y">80% less profitable Monday</a> compared to a year ago.&nbsp;



But tech companies do seem to be headed in crypto’s direction, despite the revenue headaches. <a href="https://cms.blockworks.co/meta-pins-web3-hopes-on-instagram-creators-minting-nfts/">Meta</a> and <a href="https://cms.blockworks.co/reddit-makes-pfp-nfts-cool-again-marketplace-trading-volume-surges/">Reddit</a> are integrating NFTs on their platforms. Google Cloud is <a href="https://cms.blockworks.co/google-signals-major-crypto-push-with-ethereum-solana-support/">launching new partnerships</a> with the Ethereum and Solana communities.



Companies further from Web3 development are likely less affected by crypto’s rising and falling. Caterpillar, for example, hasn’t shown much desire to move its manufacturing to the blockchain, and metaverse real estate doesn’t need heavy equipment to build.



But in the tech sector, a world where every company sees itself partly as a crypto company may not be so far off.



“In many ways, I think we&#8217;re already there,” McShane said.



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Is Crypto to Blame for Tech Companies’ Woes?

Ornella Hernandez

The NFT market is known for its volatility, and this bear market has been no different. But October showed some reprieve — a select few NFT projects bucked the trend, at least in the short term.



It was a month that saw Apple stir the pot by <a href="https://cms.blockworks.co/apple-takes-bite-out-of-app-store-nfts-in-hunt-for-revenue/" target="_blank" rel="noreferrer noopener">cracking down on NFT functionality</a> within their App Store, prohibiting apps such as <a href="https://cms.blockworks.co/tag/opensea/" target="_blank" rel="noreferrer noopener">OpenSea</a> from including external links or buttons that take customers away from the App Store to facilitate purchases or auctions.



It was an apparent move to capture potentially lost NFT revenues —- something these NFT projects seem to have little trouble with.



<h3>Art Gobblers</h3>



New NFT project Art Gobblers generated $24 million in ether (ETH) in its first 24 hours after launching on Oct. 31.&nbsp;



Venture capital firm Paradigm and Justin Roiland, co-creator of popular animated show Rick and Morty, are behind the NFTs, described as an “experimental decentralized art factory.”&nbsp;



The project launched on the Blur NFT marketplace, which is also backed by Paradigm, and has reported 26,759 ETH ($41.8 million) in trade volume so far, with an average NFT price of 18 ETH ($28,000) that keeps on climbing.



Thanks to Art Gobblers, Blur has surpassed OpenSea and other major NFT marketplaces for the first time in terms of ETH volume in the past 24 hours, per <a href="https://dune.com/queries/1498006" target="_blank" rel="noreferrer noopener">Dune Analytics data</a>.&nbsp;



It was a free mint for those on the whitelist, similar to <a href="https://opensea.io/collection/goblintownwtf" target="_blank" rel="noreferrer noopener">Goblintown</a>, a collection of similarly crude NFTs which also saw rapid initial success. However, the significant sums on the secondary market have drawn some <a href="https://twitter.com/Pons_ETH/status/1587220436986855426?s=20&amp;t=nIRkAhZdc5-xvNiw8_TZJw" target="_blank" rel="noreferrer noopener">skepticism</a> from market watchers.



In any case, a list of prominent NFT influencers and content creators acquired Gobblers, including Rug Radio co-founder Farokh Sarmad, NFT influencer Andrew Wang and content creator Zeneca.



The Art Gobblers ecosystem currently holds fewer than 2,000 NFTs, which means a few trades can really affect floor prices. The cheapest Art Gobbler NFT is now 15.9 ETH ($25,000), just two days after its launch.



Art Gobblers boasts a peculiar minting mechanism – Gradual Ownership Optimization — which secretes goo, an ERC-20 token. Holders spend goo to create blank pages on a specialized drawing <a href="https://artgobblers.com/draw/f912d913-7c41-46bd-8781-d5ff537d988e" target="_blank" rel="noreferrer noopener">tool</a>, on which they can create and sell their own art.&nbsp;



<a href="https://www.paradigm.xyz/2022/09/goo#goo-issuance" target="_blank" rel="noreferrer noopener">According</a> to a Paradigm overview about their tokenomics, Art Gobblers squirt out goo at a rate proportional to the square root of the goo already in their tanks. In other words, the more goo a Gobbler has, the faster it generates more goo (the token is <a href="https://www.geckoterminal.com/eth/pools/0x93c63cab70225568de9f56559c63a0d2de30bc1b?utm_source=coingecko&amp;utm_medium=referral&amp;utm_campaign=livechart" target="_blank" rel="noreferrer noopener">already</a> trading on Uniswap).



The more Gobblers are minted the higher the total goo supply and the almost exponential earning potential. About 290 goo holders <a href="https://etherscan.io/token/0x600000000a36f3cd48407e35eb7c5c910dc1f7a8" target="_blank" rel="noreferrer noopener">currently</a> exist. Notably, the project offers a 6.9% royalty rate – a higher than average rate issued at a time when <a href="https://cms.blockworks.co/web3-watch-twitters-potential-crypto-wallet-and-a-royalty-optional-looksrare/" target="_blank" rel="noreferrer noopener">most NFT marketplaces are going royalty optional</a>.&nbsp;



<h3>Bored Ape Yacht Club, CryptoPunks and Art Blocks</h3>



Art Gobblers arrived amid a months-long tumbling of crypto prices, as well as declining valuations among the most popular NFT projects and Web3 brands – including Bored Ape Yacht Club (BAYC) and CryptoPunks.



As of Nov. 1, however, DappRadar has <a href="https://dappradar.com/blog/leading-nft-brands-regain-1-billion-valuation" target="_blank" rel="noreferrer noopener">assessed</a> that both Yuga Labs collections have regained their $1 billion valuation status, calculated by their market capitalization.



While volume, number sales and number of traders were all down in the past 30 days, the market cap increased nearly 6% to a <a href="https://dappradar.com/ethereum/collectibles/bored-ape-yacht-club" target="_blank" rel="noreferrer noopener">$1.09 billion market cap</a> at the time of publication.



Similarly, CryptoPunks saw a 14% decline in volume during October but marked a 30% increase in market cap closing in at a $1.05 billion valuation at the time of writing, as per <a href="https://dappradar.com/hub/nft-explorer?order-by=mktCap&amp;period=month" target="_blank" rel="noreferrer noopener">DappRadar data</a>.



Parent-company Yuga Labs’ valuation <a href="https://cms.blockworks.co/bored-ape-yacht-club-creator-secures-whopping-450m-seed/" target="_blank" rel="noreferrer noopener">once stood at a $4 billion post-money valuation</a> after a $450 million funding round in March. This amount has not been re-evaluated since.



The company also holds Meebits and Otherside projects as subsidiaries.&nbsp;&nbsp;



Another collection that performed very well over the past few months — and especially during October — is the curated Art Blocks collection Gazers by Matt Kane.



According to <a href="https://opensea.io/collection/gazers-by-matt-kane/analytics" target="_blank" rel="noreferrer noopener">OpenSea analytics</a>, the numbers are up across the board over the past 30 days. At the time of writing, trading volume was at 414 ETH ($644,057) with a 74% increase; 23 sales meant 10% more sales than the month before; and the floor price was up 46% at 25 ETH ($38,892).



Similar to Art Gobblers, Gazers only has 1,000 NFTs within its collection, so the increased number of sales and trades resulted in the sharp rise in floor price.&nbsp;



The most ether paid for a Gazer during October was <a href="https://nonfungible.com/market-tracker/artblocks/BLOCKS/215000619" target="_blank" rel="noreferrer noopener">25 ETH</a> ($39,077) on Oct. 31.



Meanwhile, another popular Art Blocks collection, Chromie Squiggle project by Snowfro, <a href="https://twitter.com/absquigglebot/status/1577119440709324800?s=20&amp;t=JMM-C_ltKP_TAqLgu21PbA" target="_blank" rel="noreferrer noopener">sold</a> an NFT for 34 ETH ($45,000) on Oct. 4.



Chromie Squiggle, a collection of 9,700, <a href="https://opensea.io/collection/gazers-by-matt-kane/activity" target="_blank" rel="noreferrer noopener">registered</a> a 93% increase in trading volume and sales, 2,345 ETH ($3.6 million) and 164 ($256,000), respectively, over the past 30 days on OpenSea. The floor price is currently at 15.9 ETH ($24,700), up 41%.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">While asset markets have collapsed, Art Blocks has been on fire. Below is an equal-weighted basket of Fidenzas, Squiggles, Gazers, and Ringers. Up 3x since May 1st. <a href="https://t.co/U9aWNtsdJ8">pic.twitter.com/U9aWNtsdJ8</a>&mdash; NFTstatistics.eth (@punk9059) <a href="https://twitter.com/punk9059/status/1587467062607167488?ref_src=twsrc%5Etfw">November 1, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



<h3>Reddit NFTs and Azuki</h3>



The popularity of Reddit’s Avatar NFTs <a href="https://cms.blockworks.co/reddit-makes-pfp-nfts-cool-again-marketplace-trading-volume-surges/" target="_blank" rel="noreferrer noopener">surged dramatically</a> towards the end of October, peaking at a $2 million daily transaction volume, a 14x increase from September, and reaching a $100 million market cap.



Since then, however, the <a href="https://www.redditfloor.com/charts" target="_blank" rel="noreferrer noopener">daily transaction volume has fallen</a> back to September levels, and the market cap is just under $70 million.



The impact that the Redditfloor NFT marketplace had on Web3 was significant for two main reasons. It showed that the quickest way to onboard news users into the Web3 space — nearly 3 million in four months — is to use familiar language and not blockchain jargon.&nbsp;



It also proved that NFT profile pictures (PFPs) are still the best NFT use case up until now for onboarding those users.



Unfortunately, that didn’t stop a <a href="https://cms.blockworks.co/scammers-spread-fake-reddit-nfts-on-opensea/" target="_blank" rel="noreferrer noopener">scammer from creating fraudulent Reddit NFTs</a> and listing them to an official Reddit collectibles page on OpenSea.



The same weekend as Reddit’s success, the <a href="https://cms.blockworks.co/azuki-nfts-set-the-record-for-most-expensive-skateboards-in-history/" target="_blank" rel="noreferrer noopener">Azuki NFT project set a record</a> for the most expensive skateboards — digital and physical — sales in history.



Nine “Golden Skateboard” NFTs sold under auction for a cumulative total of $2.5 million.



The most expensive in the set — the Azuki Golden Skateboard NFT — sold for 309 ETH ($482,000). Winners can redeem their digital golden skateboards for physical skateboards plated with 24-karat gold starting this month.



A month-long boom may mean that NFT sentiment is looking up, but at least in Art Gobblers&#8217; case, the market seems ready to reward innovative (and kooky) projects.



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Art Gobblers, Reddit NFTs and Other Winners of October’s NFT Market

Sebastian Sinclair

<div id="highlights-block_635be5eace32f" class="highlights">
 <ul>
 <li>A scammer flooded an official Reddit collectibles page on OpenSea with fraudulent NFTs</li>
 <li>The counterfeits have since been taken down following Blockworks’ inquiry</li>
 </ul>
 
</div>



OpenSea has delisted a suite of counterfeit Reddit NFTs purported to exploit the hype generated by the social media giant&#8217;s foray into Web3.



The popularity of Reddit’s official NFT <a href="https://cms.blockworks.co/reddit-makes-pfp-nfts-cool-again-marketplace-trading-volume-surges/">Collectible Avatars</a> shot up dramatically this month, with daily transaction volume setting a new record on Sunday of over $2 million.



Reddit’s NFTs provide certain perks (such as standing out in comment sections), but its biggest draw allows users to own their display avatars (profile pictures) and trade them via marketplaces such as OpenSea.



But the platform has, so far, let at least one fraudulent NFT collection —- the images of which had apparently been right-click saved — mingle with the legitimate tokens viewable via Reddit’s official OpenSea collectibles <a href="https://opensea.io/RedditCollectibleAvatars?tab=collected">page</a> for at least 24 hours, according to two sources familiar with the matter.



Taking advantage of NFT platform RPlanet’s Genesis airdrop on Oct. 25, the scammer was able to flood Reddit’s Opensea page with their own <a href="https://etherscan.io/token/0xbae727e34d7f91e09bcdf0e557b5b7c6a58bcbc0?a=0xB933D690235A572f398A381A0C802304f31EDC1f">minted and airdropped</a> ERC-721 tokens.



The tokens appeared under Reddit’s collected tab where they may have been mistaken for the originals, blockchain cybersecurity firm <a href="https://halborn.com/">Halborn</a> told Blockworks.



The “collected” tab on OpenSea reflects the NFTs that a given wallet has purchased or received as a transfer. The “created” tab shows NFTs created or minted by a specific account.



Halborn said they had potentially identified the scammer&#8217;s main <a href="https://etherscan.io/address/0x75688e9036c6838322ca1a5d59f0e843ecb241d9">address</a>, which contained roughly $4,500 in various assets. The firm was unable to definitely link the address.



A total figure for the amount stolen remains unknown. A spokesperson for OpenSea declined to comment.



Slipping through the cracks



OpenSea users can either browse Reddit NFTs via the official and verified “RedditCollectibleAvatars” page or a separate “Explore Reddit Collectible Avatars” portal.



There within the collected tab were copies of the originals.



OpenSea delisted the assets shortly after Blockworks reached out.



Blockworks later confirmed the NFTs listed on the “RedditCollectibleAvatars” collected tab did not have blue check marks next to their names, as opposed to those populated in the created tab.



“Our policies prohibit theft, fraud and plagiarism, which we regularly enforce by delisting items, and in some instances, banning accounts,” an OpenSea spokesperson had earlier told Blockworks via email.



According to one source, though, a scammer was able to slip past OpenSea’s “copymint” system.



OpenSea considers an NFT a copymint if it was created with the intent to deceive users into thinking it’s the original, per its <a href="https://support.opensea.io/hc/en-us/articles/8381389579539-What-is-OpenSea-s-copymint-policy-">policy page</a>.



The scammer transferred other NFTs that looked similar to the Reddit NFTs to “RedditCollectibleAvatars” where they ended up in the collected tab, not the created tab, the person said.



OpenSea’s system, designed to curb such activity, is supposedly capable of detecting such fakes within seconds, though is not without its flaws and is constantly being fine-tuned, a source told Blockworks.



Instead, OpenSea uses a conjunction of its copymint system and real-time monitoring by employees.



Though it would appear OpenSea also relies on community outreach to notify them of suspicious activity taking place on its platform. The fake Reddit NFTs are said to have remained in place for at least 24 hours before the marketplace took action.



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<hr class="wp-block-separator">

Scammers Spread Fake Reddit NFTs on OpenSea

<div id="highlights-block_63582b050a025" class="highlights">
 <ul>
 <li>Reddit doesn’t use the term NFT to sell its collectibles</li>
 <li>The cumulative sales volume of the collectible avatars stands at $6 million</li>
 </ul>
 
</div>



Social platform Reddit has been silently rolling out new features and onboarding millions of new users to Web3 — 2.8 million to be exact, according to data provided by Polygon and Dune Analytics. 



And it’s all thanks to digital collectibles or profile pictures (PFPs).



The buzz around Reddit’s NFT avatars and growing marketplace has been attracting the attention of non-native Web3 users over the past few days.



The numbers speak for themselves.&nbsp;



Nearly 3 million new wallets have been opened since the <a href="https://cms.blockworks.co/reddits-new-nft-marketplace-opens-the-door-to-avatar-sales-trading/" target="_blank" rel="noreferrer noopener">RedditFloor marketplace</a> launched and dropped its own avatars in July. Users have minted more than 86,000 NFTs.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="402" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg" alt="" class="wp-image-35668" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=50 50w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-Reddit-users-1024x402.jpg?w=1736 1736w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Number of collectible avatar holders over time | Source: <a href="https://dune.com/polygon_analytics/reddit-collectible-avatars" target="_blank" rel="noreferrer noopener">Dune Analytics</a>, @polygon_analytics</figcaption></figure>



On Sunday, daily volume surged from below $1 million to $2 million in less than 24 hours. At the time of publication, the 24-hour sales volume was about $2.6 million.  



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="512" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg" alt="" class="wp-image-35669" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=50 50w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-reddit-chart-1024x512.jpg?w=1104 1104w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Source: <a href="https://www.redditfloor.com/charts" target="_blank" rel="noreferrer noopener">Redditfloor.com/charts</a> </figcaption></figure>



Reddit NFTs collectively have a $122 million market cap, <a href="https://www.redditfloor.com/" target="_blank" rel="noreferrer noopener">according</a> to the marketplace.



For comparison, OpenSea, the largest secondary NFT marketplace, has 2.3 million users. Magic Eden, the top Solana marketplace, has 1.2 million, and LooksRare has around 107,000 users, <a href="https://dappradar.com/nft/marketplaces" target="_blank" rel="noreferrer noopener">according</a> to DappRadar data. 



The collectibles are minted on the Polygon proof-of-stake blockchain, which is compatible with the Ethereum virtual machine. Their success has resulted in a huge surge in NFT volume on OpenSea on Polygon over the last couple of days.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="456" src="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg" alt="" class="wp-image-35670" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=80 80w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=50 50w, https://blockworks-co.imgix.net/wp-content/uploads/2022/10/2022-10-25-Dune-OpenSea-vol2-1024x456.jpg?w=1529 1529w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>OpenSea Polygon Daily Volume; Source: <a href="https://dune.com/niftytable/OpenSea-on-Polygon" target="_blank" rel="noreferrer noopener">Dune Analytics</a> @niftytable</figcaption></figure>



The director of research at Proof Collective, known as punk9059, found that Reddit avatars recorded as much trading volume on Oct. 24 — around 1,900 ether (ETH) — as all the ETH NFT volume on Blur, LooksRare, x2y2, LarvaLabs and SudoSwap marketplaces combined.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Yesterday Reddit Avatars did as much volume (~1900 ETH) as all the ETH NFT volume on Blur, LooksRare, x2y2, LarvaLabs, and SudoSwap combined. <a href="https://t.co/C2rbpiZuQU">pic.twitter.com/C2rbpiZuQU</a>&mdash; NFTstatistics.eth (@punk9059) <a href="https://twitter.com/punk9059/status/1584897392004190209?ref_src=twsrc%5Etfw">October 25, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



This amount of ETH is comparable to <a href="https://cms.blockworks.co/azuki-nfts-set-the-record-for-most-expensive-skateboards-in-history/" target="_blank" rel="noreferrer noopener">1,901 ETH ($2.5 million) sales of Azuki NFTs</a> representing gold-plated skateboards over the same weekend.



<h3>RedditFloor is different</h3>



A few things set this marketplace apart from others, such as its native integration. Reddit’s marketplace allows users to create wallets and mint and customize NFTs directly in-app.&nbsp;



Notably, mentions of crypto lingo are scant on the site, not even the term NFT. Reddit instead sold NFTs as digital collectibles or collectible avatars. Users can display them as profile pictures when users create content on the popular social media platform.



Additionally, “coins” replace tokens and “vaults” refer to wallets. Users can pay for NFTs with credit or debit cards and store their assets in Reddit’s Vault wallet. The checkout process is simple and “looks like you&#8217;re buying a video game avatar,” <a href="https://twitter.com/threadoor/status/1584589871007481857?s=20&amp;t=1_iN_gTHQs3fq9mo5YvA9A" target="_blank" rel="noreferrer noopener">according</a> to Twitter user threadoor.eth.



This has likely attracted non-crypto-native users who don’t realize they are using blockchain technology, or who may have been deterred by complicated crypto language in the past.



While most NFT collections tend to have a 10,000 unit cap, Reddit features around 40,000 limited-edition NFTs designed by Reddit artists.&nbsp;



While digital collectibles are just one use case for NFTs, Redditors are proving that PFP NFTs are still relevant and coveted.&nbsp;



Those that choose to make use of their avatars in their profile signal a certain status as Collectible Avatar owners.



The ability to mix and match traits and customize avatars, with a focus on rarity, may incentivize people to hold multiple NFTs at once.



The highest amount paid for a Reddit NFT is $14,817, while the cheapest NFT is currently going for $29.&nbsp;



Reddit’s initial foray into NFTs went down in June 2021 with the drop of its first NFT collection, CryptoSnoo, based on the platform&#8217;s logo <a href="https://www.reddit.com/r/Snoo/" target="_blank" rel="noreferrer noopener">Snoo</a>. This latest initiative leverages its existing base of 52 million daily active users and appears to be targeting a more mainstream audience.



Reddit’s co-founder Alexis Ohanian is a vocal proponent of blockchain and crypto and most recently started fundraising for his digital assets-focused venture capital firm Seven Seven Six. Its new fund, dubbed Kryptos, <a href="https://cms.blockworks.co/seven-seven-six-to-launch-177m-crypto-fund/" target="_blank" rel="noreferrer noopener">plans to invest $177.6 million into early-stage Web3 startups</a> and cryptocurrency tokens.



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Reddit Makes PFP NFTs Cool Again, Marketplace Trading Volume Surges

<div id="highlights-block_62f18e1c2a5e3" class="highlights">
 <ul>
 <li>Users can move Reddit’s Community Points to Arbitrum-built Ethereum wallets and pay gas fees with FTX Pay</li>
 <li>R/cryptocurrency forum members earned up to $340 in Community Points tokens for posting in the subreddit last month</li>
 </ul>
 
</div>



In the latest instance of FTX embarking on a massive bear market <a href="https://cms.blockworks.co/ftx-reportedly-in-talks-to-buy-south-korean-exchange-bithumb/" target="_blank" rel="noreferrer noopener">buying spree</a>, the crypto exchange has struck a deal with Reddit.&nbsp;



The crypto-to-fiat exchange platform FTX Pay is integrating with Reddit and Arbitrum to allow users to pay gas fees on Reddit’s “Community Points” tokens using fiat. Community Points, rolled out in 2020, are blockchain-based Reddit tokens that allow users to divvy out rewards and interact with the social platform 



Reddit is a choice platform for retail crypto investors — crypto was the platform’s <a href="https://www.redditinc.com/blog/reddit-recap-2021" target="_blank" rel="noreferrer noopener">most-viewed topic in 2021</a>. In July 2021, the rollup solution Arbitrum <a href="https://www.reddit.com/r/ethereum/comments/opi5rg/scaling_reddits_community_points_with_arbitrum/" target="_blank" rel="noreferrer noopener">won a contest</a> to build an Ethereum rollup for Community Points, and now the rollup is launching on Ethereum’s mainnet, the company said Tuesday.&nbsp;



Community Points allow subreddits to reward active members or make governance decisions.



<a href="https://cms.blockworks.co/the-merge-will-not-lower-ethereum-transaction-fees/" target="_blank" rel="noreferrer noopener">Like all layer-2 rollups</a>, Community Points transactions are settled on Ethereum, and Reddit enlisted the expansion-minded FTX to let users pay Ethereum’s transaction fees using fiat.



“Users need Eth for gas fees to transact with their Community Points on-chain, and FTX Pay allows them to do that,” said Amy Wu, head of FTX Ventures, in an email.&nbsp;



Community Points are, for now, only live in the r/cryptocurrency and r/fortnite subreddits, though <a href="https://docs.google.com/forms/d/1xSpGcBc0TP3GpfNgo3F0pV86OQYiEwUcsWBu3-RtfiU/viewform" target="_blank" rel="noreferrer noopener">Reddit has a waitlist</a>. Reddit airdrops points to active users — similarly to how users receive “Karma” for upvoted posts.&nbsp;



Top contributors in r/cryptocurrency earned 3,774 “Moons” tokens last month, or about $340 at current <a href="https://coinmarketcap.com/currencies/moon/" target="_blank" rel="noreferrer noopener">secondary market prices</a>. A spokesperson for Reddit said Community Points are only meant for community governance and “reputation points” on Reddit, adding that selling the tokens is against the site’s terms of use.



Steven Goldfeder, CEO of Offchain Labs, the developer behind Arbitrum, told Blockworks he hopes to see new use cases emerge around Reddit’s crypto tokens.



“We have the entire rollup and security mechanism built out, but we also allow for others to develop in this ecosystem,” Goldfeder said. “It&#8217;s not just Reddit launching Community Points. Others can tap into that. For example, a game developer can go ahead and say, ‘I&#8217;m launching a game and the currency in my game are these Reddit Community Points.’”



Reddit’s crypto integration marks the latest instance of a Web2 company buying into Web3 technology, following <a href="https://cms.blockworks.co/instagram-expands-nft-feature-to-creators-worldwide/" target="_blank" rel="noreferrer noopener">Instagram’s expansion of its NFT integration</a> last week.&nbsp;



“Reddit has a massive community,” Goldfeder said, “How do you get a billion users on blockchain? It’s by tapping into these existing communities and bringing them to the blockchain.”



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FTX Bringing Crypto Swaps to Reddit

Casey Wagner

<div id="highlights-block_62c70d5fa3f13" class="highlights">
 <ul>
 <li>The NFT collectible series allows users to profit from their art</li>
 <li>The avatars, which can be purchased without cryptocurrencies using standard credit or debit cards, range in price from $9.99 to $99.99</li>
 </ul>
 
</div>



As social media platforms ramp up their cryptocurrency dealings, Reddit launched an NFT marketplace Thursday, where users can purchase blockchain-based avatars at a fixed price in fiat currency.&nbsp;



The avatars — which can be purchased without digital assets using credit or debit cards — cost anywhere from $9.99 to $99.99 and can be used as customizable profile pictures.&nbsp;



The NFT (non-fungible token) marketplace ought to expand upon Reddit’s previous avatar creation tool, which hit the market two years ago. The new NFT feature will give users a license to create any type of avatar and earn profits from their art, according to Reddit’s <a href="https://www.redditinc.com/blog/blockchain-backed-collectible-avatars-coming-to-reddit-via-new-storefront" target="_blank" rel="noreferrer noopener">announcement</a>.&nbsp;



“Collectible Avatars are limited-edition avatars made by independent artists,” the company said. “If someone sets their Collectible Avatar as their avatar on Reddit, they can mix-and-match the avatar gear with other Reddit avatar gear and accessories, and their profile image in comments sections will have a glow-like effect.”



The art can be used on and off of Reddit, the company said.&nbsp;



Collectible Avatars will be available to everyone in the coming weeks, Reddit said, but a limited number of Reddit users in the <a href="https://www.reddit.com/r/CollectibleAvatars/" target="_blank" rel="noreferrer noopener">Collectible Avatars community</a> were granted early access on Thursday.



It’s not Reddit’s first foray into NFTs. Earlier this year, the company, following <a href="https://cms.blockworks.co/twitters-new-nft-verification-tool-does-not-confirm-authenticity/" target="_blank" rel="noreferrer noopener">Twitter’s footsteps</a>, introduced a feature that would allow users to make Ethereum-based NFTs their profile pictures.&nbsp;



For its new avatars, Reddit worked with artists from popular creative communities, such as <a href="https://www.reddit.com/r/comics/" target="_blank" rel="noreferrer noopener">r/Comics</a>, the company said.&nbsp;



“From the start, our goal has been to empower artists to create and sell their work,” Reddit said. “Artists will get paid for every Collectible Avatar that sells on Reddit, less any fees, and are also entitled to receive royalties from secondary sales of their Collectible Avatars on open marketplaces.”



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<hr class="wp-block-separator">

Reddit’s New NFT Marketplace Opens the Door for Avatar Sales, Trading

Jacquelyn Melinek

<div id="highlights-block_61fd75403556f" class="highlights">
 <ul>
 <li>On Friday, layer-2 infrastructure firm Qredo closed its $80 million Series A round led by 10T Holdings</li>
 <li>Earlier this week, Seven Seven Six closed a whopping $500 million venture fund for its second fund, which will focus primarily on crypto startups</li>
 </ul>
 
</div>



Capital continued to pour into crypto this week, despite a recent downturn in digital asset markets.



“Significant capital raises that closed last year will be deployed now, I expect an increased pace of activity,” Stan Miroshnik, co-founder of 10T Holdings, <a href="https://cms.blockworks.co/crypto-vc-market-poised-for-growth/" target="_blank" rel="noreferrer noopener">told</a> Blockworks earlier this week.



Layer-2 infrastructure firm Qredo closed its $80 million Series A round Friday, led by 10T Holdings, with participation from Coinbase, Avalanche and Terra. The raise brings its valuation to $640 million, after raising $120 million across the past 12 months.



“Infrastructure is a key battleground for scaling crypto adoption,” <a href="https://cms.blockworks.co/podcast-is-the-crypto-bull-market-over-dan-tapiero-and-dan-morehead/" target="_blank" rel="noreferrer noopener">Dan Tapiero</a>, founder and CEO of 10T Holdings, said.



More than $800 million was raised this week, according to PitchBook data. Some of the larger rounds include <a href="https://cms.blockworks.co/ftx-valued-at-32-billion/" target="_blank" rel="noreferrer noopener">FTX’s $400 million</a>, <a href="https://cms.blockworks.co/crypto-wallet-raises-109-million/" target="_blank" rel="noreferrer noopener">Phantom’s $109 million</a> and <a href="https://cms.blockworks.co/web3-data-firm-dune-analytics-hits-unicorn-status/" target="_blank" rel="noreferrer noopener">Dune Analytics’ $69.42 million</a> capital raises.



Other fundraisers include:



<ul><li>Pixel Vault’s $100 million, which will be used to help launch an NFT platform</li><li>Tribal Credit, which offers crypto financial services, raised $60 million in a round led by SoftBank to expand into Latin America</li><li>CoinFund co-led $5.7 million seed round in prime brokerage liquidity protocol Primex Finance</li><li>Celebrity-focused NFT platform Colexion’s $5 million raise to expand into the metaverse</li><li>DAO-to-DAO credit lending platform Kyoko Finance closed $3 million private round led by Animoca Brands</li></ul>



Meanwhile, Reddit Co-founder Alexis Ohanian’s venture capital firm, Seven Seven Six (776), closed a whopping $500 million venture fund. The raise was oversubscribed, with $300 million going toward funding early-stage startups and $200 million going toward companies in growth stages.



The firm plans to primarily invest in crypto startups by the end of the year, Ohanian <a href="https://www.wsj.com/articles/alexis-ohanians-venture-capital-firm-raises-500-million-doubles-down-on-crypto-startups-11643716803" target="_blank" rel="noreferrer noopener">told</a> the Wall Street Journal. The VC has over $750 million assets under management, just $26 million short of matching their name, 776, Ohanian <a href="https://twitter.com/alexisohanian/status/1488496693549142019?s=20&amp;t=Vp_Sq3zKGfyP5m6tHu0NWg" target="_blank" rel="noreferrer noopener">quipped</a> on Twitter.



Ark Invest filed to launch a venture fund that would invest in companies involved in disruptive innovation, including those related to crypto and blockchain technology, <a href="https://cms.blockworks.co/ark-invest-seeks-to-launch-venture-fund/">Blockworks reported</a>.&nbsp;



Separately, Arca also launched its NFT fund this week, which oversubscribed its initial cap of <a href="https://www.globenewswire.com/news-release/2022/02/03/2378523/0/en/Arca-s-Oversubscribed-NFT-Fund-Closes-At-50M-Cap.html" target="_blank" rel="noreferrer noopener">$50 million</a>. The fund joins the firm’s three other investment products, including its Digital Assets Fund and Digital Yield Fund. The fund will invest in NFTs, as well as digital property, in-game assets, DeFi-integrated NFTs and utility- and reward-based NFTs.



“We believe that, at present, there is a dislocation between the value of non fungible assets and the value of the underpinning ecosystem via equity, tokens, etc,” Arca Portfolio Manager Sasha Fleyshman told Blockworks in a statement. “We look to both capitalize on that mismatch and catalyze the perception change of investing directly into NFTs as investment grade assets.”



Check back next week for even more funding news.



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