Reddit’s crypto closes the week with a +236%

Last week MOON, the native crypto of social network Reddit, recorded an incredible pump in its price that created a strong FOMO within the crypto community.

On Monday, 13 November, the coin marked a value of $0.056, but the next day an unexpected piece of news sent its price up to $0.44 before it tracked back to the $0.2 area.

Notably, an update announced last Tuesday will make the MOON token fully decentralized and belonging exclusively to Reddit stakeholders, in parallel with a 30% burn of the total supply of the cryptographic resource.

In this article we first delve into crypto MOON by seeing what it is and how it works, and then focus on the speculative front and analyze the coin’s situation in the crypto markets.

MOON: the social media crypto from Reddit

MOON is a crypto belonging to the Arbitrum Nova blockchain that assumes utility within the Reddit social media ecosystem, more specifically within the r/Cryptocurrency subreddit.

The latter serves as a virtual place where the main crypto-themed discussions take place and where news inherent to this world is published.

The MOON cryptocurrency was initially launched in 2020 as an ERC-20 token on the Ethereum network by Reddit admins as part of an incentive program on the same platform, which has been suspended to date.

Until a few weeks ago, the crypto was distributed every 28 days to all subreddit users who contributed or posted valuable content achieving high impressions and engagement within the community.

During MOON’s early days, this mechanism was quite successful as group members were incentivized to share interesting information and analysis every day in order to earn tokens that could be converted to BTC or other cryptocurrencies.

The coin today can then be used for various functions, such as unlocking premium features on social media or purchasing space for a banner ad on r/Cryptocurrency for a limited time.

In particular they can be used to show reputation within the subreddit, unlock like badges and GIFs in comments with a special subscription, and add weight to votes in polls. 

All of this contributes to a dynamic ecosystem that is self-incentivizing and evolving due to the presence of a decentralized currency that takes on an economic role.

In addition, MOON also fulfills a governance role by empowering its holders to vote on proposals discussed among Reddit’s crypto community.

Proposals are made by subreddit members and heavily involve the strategic direction of the crypto enthusiast group and can include important updates to MOON itself such as changes on the distribution rate and implementations of new features.

MOON +236% in the last week: latest news and analysis of token prices

Reddit’s crypto MOON has been attracting a lot of attention in recent days because of the sharp increase in prices the coin has seen over the past week.

It all started when last Tuesday, the subreddit’s admins announced a key update for the crypto, intent on restoring value to the asset after it collapsed miserably in October following the company’s decision to permanently end the “Community Points” program.

More precisely, on 17 October MOON had lost 85% of its value in just 24 hours, given the negative news involving the entire ecosystem.

On Tuesday, 14 October, however, the crypto suddenly rose from the ashes, closing the day with +115% and recovering all the previous month’s dump.

This is because with the latest update the Reddit team made it clear that MOON would definitely become a resource belonging exclusively to the subreddit community.

In fact, the project administrators chose to voluntarily relinquish control over the coin’s distribution contract, preventing new resources from being created while performing a 34 percent burn of its entire supply.

With this move, the total supply has decreased from 126 million tokens to the current 83 million, but more burns are planned in the future.

Hence, after the loss of the incentive program that guaranteed a flow of valuable content within the subreddit giving a sense of existence to the MOON token, here is a game changer, with the resource going from being blatantly inflationary to highly deflationary.

Looking at the situation from a purely speculative point of view, we can see how after the mid-October dump, prices moved sideways, with some hints of bullish recovery for about a month.

On Monday, 13 November, MOON’s value rose 95%, likely due to the pump of some insiders in the group who made substantial purchases in anticipation of the next day’s news.

Then on Tuesday, 14, prices exploded to the upside with a 460% movement accompanied by volumes of $22 million on the MOON-USD market on the Kraken exchange alone.

These are big numbers for a crypto that capitalizes only $19 million according to CoinMarketCap data.

The day ended with a long spike that closed the candle at $0.22, roughly at the same pre-dump level as a month ago.

Overall, MOON ended the week with a crazy 236% increase that gave strong emotions to its token holders, reaching a price of $0.17 to date.

Now a continuation of the bullish trend is crucial for Reddit’s crypto to finally break the $0.25 mark.

On the flip side, a bearish break of $0.15 could undo the entire pump, taking prices back in the direction of yearly lows.

In this context, trading MOON is very dangerous as volatility is extreme, hence be very careful traders.