- Reddit removed two moderators of the r/CryptoCurrency subreddit who were found to have engaged in insider trading of MOON tokens before an announcement caused the token’s price to crash.
- The moderators sold hundreds of thousands of dollars worth of MOON tokens minutes before Reddit announced it was closing its blockchain points program involving community tokens like MOON.
- An investigation found that moderators exploited insider knowledge of the program’s closure to sell tokens and avoid losses right before the public announcement caused an 85% price drop.
Reddit’s r/CryptoCurrency community has fired two moderators who were found to be involved in insider trading of the MOON (MOON) token, Cointelegraph has confirmed. The moderators sold their tokens right before an announcement caused the price to crash. This article will provide details on the allegations, investigation, and outcomes.
Details of the Allegations
At least three wallets linked to Reddit group moderators dumped hundreds of thousands of dollars worth of MOON tokens on Oct. 18, just minutes before Reddit announced it was closing its blockchain-based points program involving community tokens. This market dump was highlighted by on-chain analysis accounts on Twitter.
The Reddit moderators were made aware of the closure an hour before the public announcement. When the news went public, MOON dropped 85% to $0.00198. But the moderators had already sold at higher prices before the crash.
— BlockNews.com (@blocknewsdotcom) October 23, 2023
NEWS: Reddit's r/CryptoCurrency community fires two moderators over insider trading allegations.
Investigations confirmed that these moderators sold massive quantities of tokens before the sun-setting announcement.
The move preceded an 85% plunge in the token's value. pic.twitter.com/plQ5g4AatV
Investigation and Removal of Moderators
Cointelegraph reached out to r/CryptoCurrency to understand the investigation. Two moderators were removed, while three others are still being investigated for potential insider trading.
The points program allowed Reddit users to earn and spend community tokens like MOON. Moderators appear to have exploited insider knowledge of the closure to avoid losses.
Conclusion
In summary, Reddit has taken action against moderators who allegedly engaged in insider trading around the MOON token, in light of the points program closure announcement. The investigation uncovered abuse of insider information, leading to the removal of two moderators so far. This demonstrates Reddit’s commitment to enforcing ethical behavior among its leadership members.
