Research Analysis of r/CryptoCurrency Community’s Token MOON

MOONs are ERC-20 token on Arbitrum Nova launched by Reddit admins in May 2020 as a part of the Community Points project. They are a means for users to be rewarded for their contributions in r/CryptoCurrency with a unit of ownership in the subreddit. MOONs are independent of Reddit and once earned neither the admins nor the subreddit moderators can take them away from users. MOONs are managed by a suite of smart contracts that handle balances, transfers, distribution/ claiming, and purchasing Special Memberships. The smart contracts and mobile apps have been reviewed and audited by Trail of Bits, an independent security firm.

MOON Token

The total supply of MOON token is 250,000,000 MOON. The r / CryptoCurrency subreddit distributes MOONs once every four weeks based on the amount of karma the user has gained. It also allows users to propose alternative distribution with a proposal and community vote. There are two noteworthy days every four weeks according to the MOON calendar:

  • Snapshot Day: The date Reddit calculates the karma for each account.
  • Distribution day: The day accounts receive the corresponding number of MOON tokens in their vault.

Karma Ratio is related to the MOONs distribution.Each month MOONs are being distributed (last month it was 1,260,000 MOONs to users).

Karma Ratio = MOONs to Distribute to Users / Total Karma Earned From All Users

For example, last month 1.26M MOONs were distributed to users and a total of 1.35M Karma earned by users . Therefore, the Karma Ratio was 0.932. For each 0.932 Karma earned on the subreddit, the user will earn 1 MOON.

Initially, 50 million Moons will be distributed based on karma earned in the subreddit to date. The amount distributed each following month will start at 5 million and decrease by 2.5% every cycle, so that the total number of Moons distributed over time will approach a maximum cap of 250 million.

The maximum number of MOON that a user can receive is dynamic.The Karma cap is at the 99.9th percentile karma, which means if there are 30k users that earned Karma this month, the Karma cap will be the 30th user’s Karma. Users can sell up to 25% of their total earned MOONs without any impact on their future earnings.

To encourage MOONs holding,Karma Multiplier(KM) is created, which is  based on Moon Retention to reward users for holding and penalize those who don’t.

The Karma Multiplier (KM) will be calculated as follows:

KM = (Current Balance + Membership Purchases) / (Total Earned Moons * 0.75)

KM ranges from 0.1 to 1 KM. 1 Means that the user holds all or more than the Moons he earned.0.1 Means the user sold all his earned Moons- if he’s supposed to earn 1,000 Moons next month, he will earn 100 Moons only – 10%. Users with 0.5 KM will receive 50% of the amount he’s supposed to get next month.

Using scenarios of MOON Token include:

  • MOONs are used to vote on Governance Polls that influence how the community is governed and how MOONs are distributed. The maximum voting weight is determined by user’s amount of  MOONs earned, which includes those received through the normal distribution or from the MOON Distributor Account (contest awards, etc). If users acquire MOONs beyond the amount they have earned, they will not gain voting power. If users sell, tip, or otherwise transfer away their MOONs below the amount they’ve earned, their voting weight will be decreased proportionally.
  • MOONs can be tipped between users.
  • MOONs can be used to purchase the r/CryptoCurrency Special Membership which allows for embedding GIFs in comments, special emotes & custom flair/color for the username.
  • MOONs can be redeemed for Reddit coins for use in r/CryptoCurrency.
  • MOONs are a proof of reputation and contribution in the r/CryptoCurrency community. The more a user contributes, the more MOONs they will earn, which results in more influence in the community. This reputation is inherently portable across the Internet.
  • As ERC-20 tokens, MOONs can be used off of Reddit on websites or apps that support them. Developers can start building on top of MOONs through standard blockchain tools and protocols to add more utility and value.
  • MOONs are burned in exchange for AMA’s/live talks within the subreddit. In the future, they may be used to purchasing other forms of advertising within the community.

Partnership

  • Due to scalability issues, Moons originally launched on Rinkeby testnet with the plan to migrate over to the Ethereum Mainnet. Reddit partnered with the Ethereum Foundation in February 2021 to develop an open-sourced scaling solution for Moons.
  • While Arbitrum Nova has significantly lower fees than other networks, there are still gas fees that need to be paid to use MOONs on mainnet. Reddit maintains that they will continue to cover gas fees for distributions and for spending MOONs on features such as Special Memberships and Reddit coins, however users are now responsible for gas fees for tips or transfers within the vault. Reddit partnered with FTX to provide a solution for users to purchase ETH on Nova in order to pay for these gas fees, which are currently expected to cost less than $0.01 per transfer.

Limitations of MOON Token

MOON is part of a unique idea that seeks to encourage high-quality community participation in the form of original posts and comments. Users earn MOONs based on their four-week karma score, which is calculated based on the positive and negative votes they receive for their posts or comments within that time period.

However, MOONs are not very useful outside of their role of facilitating community participation. Users cannot easily sell or buy MOONs because the token is not listed on most major cryptocurrency exchanges. However, some users see MOON tokens as free money that can be accumulated without much effort.

How to trade MOON on MEXC ?

Step1: Log in your MEXC account on MEXC Global , then click [Market] on the navigation bar.

Step2: Type [MOON] in the search bar to find MOON/USDT trading pair, then go to trading page.

Step3: Go to the Buy/Sell section to buy/sell MOON , fill in the price and the amount for your order ,then finish trading.

Start your crypto trading journey with MEXC Global Exchange


The content of this webpage is not investment advice and does not constitute an offer or solicitation to offer or recommendation of any investment product. It is for general purposes only and does not take into account your individual needs, investment objectives, and specific financial circumstances. Investment involves risk.

Please note that the information and data above are cited from third-party sources & whitepapers and do not represent MEXC. Please refer to direct sources for more details. This is not financial advice and does not constitute an offer or solicitation to offer or recommend any investment product. It is for general purposes only and does not take into account your individual needs, investment objectives, and specific financial circumstances. Investment involves risk.

This disclaimer informs readers that the MEXC Creator’s content, views, thoughts, and opinions expressed in the articles belong solely to the creators and authors, and not to MEXC Global itself. MEXC Global doesn’t give any investment recommendations or advice.

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