Social media platform Reddit announced last July that it was partnering with the Polygon network to mint Ethereum-compatible collectible avatars on-chain and sell them on a new marketplace.
This initiative kicked off with 90 different designs – tens of thousands of collectibles distributed for free, some licensed limited-edition avatars. In recent days, Reddit’s bet has seemingly borne fruit – a winning strategy to get users on board with NFTs and simultaneously a realization of the potential of blockchain technology. The recent upturn is especially welcomed as it follows a period of doubt when most were skeptical about embracing NFTs on Reddit, having not been convinced of their use cases.
Reddit’s avatar collectibles turn the spotlight on the NFT scene
Last week, Reddit’s chief product officer Pali Bhat attended the TechCrunch Disrupt event in San Francisco, where he confirmed that Reddit users have created more than 3 million vault wallets. The Redditors use the wallets to purchase and trade collectible avatars molded based on the social media platform’s alien mascot – Snoo. This figure recorded since the launch of the first season in July is more than the number of crypto wallets trading on the NFT marketplace OpenSea.
Trading volume
The release of the second season of the PFP collection, which included the likes of Spooky Season Poieeeyee, inspired demand for Reddit avatars. These sold out much faster than the previous release did. Specifically, most of Reddit’s top leading collections have seen their floor prices grow over the last seven days. Notable ones include The Senses and The Foustlings collections, whose trading volumes have increased by 920% &1016%, and floor prices have grown to 1.48 ETH & 1.03 ETH in the last week, respectively.
Trading volumes show how these changes have transpired in the last few days – data from Dune Analytics indicates that the collectible holders’ count has ballooned to 2,851,639, having a total of 2,937,610 avatars. The total collectible avatar sales volume now stands at $7.5 million, 229% up on the week.
User community is behind the collectibles’ success
Reddit appears to be one of the Web2 entities best integrating Web3 features, at least this far. Being a traditional social media company, the network already had a large user base to serve, even before this ‘new age’ of the internet properly materialized. Remember the mascot Snoo? It has always been an integral part of the Reddit community and has now become a core of the NFT community building inside the social media powerhouse.
The social platform’s NFT initiative is built around the mascot’s likeness. Thus, the avatar collectibles bear a sort of resemblance to a figure already familiar to its users. These avatars can be displayed on Reddit user profiles, are transferrable via blockchain, and whose additional perks include a glow shine on users’ comments and the capability to mix and match apparel with other avatars.
One other thing Reddit did right was the nomenclature it used when coining labels for the products that would come with the avatar collectibles. Instead of NFTs, there are Digital Collectibles, and rather than call them crypto/ NFT wallets, they are Reddit Vaults. Even casting the crypto jargon further away, Reddit only accepts fiat/ credit card payments for any avatar purchase. From a different perspective, Reddit isn’t castigating crypto; instead, the platform is making it easier to onboard non-crypto natives of the mainstream audience into Web3. It is a given that many other Web2 brands and entities in the crypto space will be closely watching this development in the future.
Mint blockchain NFT reception
Polygon is one of the largest Ethereum scalers, laden with several solutions to enhance the performance of the base layer. The network has, however, failed to beat the sector-wide slump witnessed in the NFT space, performing remarkably worse than its peak periods last year. For instance, its 146,661 monthly NFTs sold on OpenSea in September were at least nine times lower than Ethereum’s volume over a similar period.
In other news this week, blockchain analytics platform Nansen announced NFT support for Polygon alongside an analytics dashboard delivering real-time on-chain data on over 397k collections on the chain.
Polygon (MATIC) upward action peters out below $1.00
Polygon (MATIC) has enjoyed bullish action for the better part of this week, breaking through $0.90 for the first time in six weeks. The native token has also benefitted from the hype around Reddit NFTs launched on the network. The 7-day MATIC/USD chart shows its price recorded a steady rise on Monday before pausing briefly and resuming the uptrend.
MATIC/USD trading chart
Bullish traders face an uphill task of securing the gains and seeking a breach of $1.00 which has remained unvisited for more than two months. Polygon (MATIC) fell below this mark in May at the time Terra’s ecosystem crashed, sending fear and panic among investors. Though MATIC reclaimed this level, albeit shortly, a couple of months later, on Aug.14, it has been unable to get sight again.
Amid this poor price action, the MATIC balance on exchanges has been shrinking and this week touched a nine-month low. Crypto analytics platform Santiment reported on Tuesday that the supply of MATIC in cryptocurrency exchanges dropped to its lowest level since January. This decrease, Santiment observed, reflects a trend extending the last four months, during which more than 600 million MATIC coins have been taken off exchange platforms. A mass exodus of tokens from exchanges is usually associated with a bullish projection as it could be a pointer of investors stashing because of conviction of prices rising in the long term.
To learn more, check out our Investing in Polygon guide.
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