MOON, a cryptocurrency linked to Reddit’s cryptocurrency tab, captured the market’s attention in July after a 450% appreciation. However, Reddit chose to end the rewards project, causing MOON’s price to plummet over the past week.
Three moderators are accused of selling their MOONs before this 85% drop. According to the allegations, moderators were forewarned of Reddit’s plans and used this information in a privileged manner.
“Three moderators of the r/CryptoCurrency subreddit sold MOON early due to insider knowledge of Reddit admins”, He wrote the analytics company Lookonchain.
In total, one of the moderators is said to have profited 23 thousand dollars from the operation, 23 minutes before the announcement. A second sold another $69,000 17 minutes before the crash and finally a third sold $59,000 to MOON 2 minutes before the crash. Added together, the amounts amount to 151 thousand dollars (R$755,000).
Last week, MOON traded at US$0.23 and this Monday (23) at US$0.035. Since there is no use case after Reddit’s decision, it’s hard to believe the project will rise again.
Moderators are fired, but the punishment was seen as light by other investors
With 6.9 million members, the r/CryptoCurrency is the 68th largest social network subreddit that has managed to sell out several NFT sales. The number of users is so large that it exceeds r/Bitcoin and its 5.8 million people, making it the largest in the cryptocurrency space.
Given its size and the amount involved in the MOONs movement before Reddit’s official announcement, those responsible for r/CryptoCurrency decided to fire the three moderators accused of insider trading.
“All moderators who were selling Moons before the announcement have now been removed from the moderation team”a representative wrote to CoinDesk.
For some investors, the decision was not lenient enough and moderators should be held legally accountable for their actions.
By comparison, former Coinbase executive Ishan Wahi was given a 36-month prison sentence for leaking information about stock exchange listings, allowing his brother Nikhil and another investor to profit millions from illegal operations.
Nathaniel Chastain, former product director at OpenSea, was also arrested in the US on similar charges. As recently as 2021, the director was accused of purchasing NFTs, knowing which would be highlighted on OpenSea’s main page, allowing him to multiply his capital.
Finally, the case of MOONs from r/CryptoCurrency shows that the cryptocurrency industry has not yet solved its problems with confidential information and that even arrests do not serve as an example to prevent new cases.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
