Reddit may have demonstrated the best way to introduce the masses to the world of blockchain: Avoid complicating things with talk about cryptocurrency and non-fungible tokens.
The social media and discussion platform recently released a collection of “Collectible Avatars” users can either claim or purchase. Reddit also appeared to purposely avoid using blockchain terms like “crypto” and “NFT” in the main portion of its sales presentation of the digital collectibles.
The net result is that since Reddit launched its NFT marketplace in July, users have created about 3 million crypto wallets, a company executive recently said. That’s several hundred thousand more than the 2.3 million active wallets held on OpenSea, the world’s largest NFT marketplace, which has been in operation for nearly five years. Subtracting the number of active OpenSea wallets —again, the most popular NFT marketplace— by the number of Reddit wallets suggests that Reddit’s strategy may have helped encourage as many as half a million or more people to buy an NFT for the first time.
Reddit’s seemingly simple approach to describing the digital avatars and how they can be claimed and traded has demonstrated a different, if not simplified, way for an established technology company to introduce users to web3 products like cryptocurrency and NFTs. Reddit NFTs have generated more than $6.7 million in total sales volume, according to crypto analytics platform Dune.
The platform allows users to buy their Reddit avatars with regular fiat currency rather than cryptocurrency.
Reddit “seems to have paved the way for mainstream adoption,” according to The Block research analyst Thomas Bialek, who added that the social media network may have largely steered clear from using “NFT” in most descriptions of the avatars as a way of avoiding controversy.
“'NFT' is a dirty word right now, for better or worse,” said Sasha Fleyshman, an NFT fund manager at Arca, a digital assets investment firm.
Falling cryptocurrency prices have caused a lot of heavily-promoted NFT collections to lose significant value in recent months. Many people who bought NFTs when prices were high have subsequently seen the value of their digital assets sink dramatically.
“Reddit’s Collectible Avatars have proved to be an easy-to-understand and fun introduction to NFTs and cryptocurrency,” said Barney Chambers, cofounder of Umbria Network, a company helping people migrate fungible assets between cryptocurrency networks. Chambers agrees that Reddit’s strategy of staying away from “crypto jargon” appears to be paying dividends.
Many of the platform’s users have been commenting in forums about how buying a Reddit avatar represented the first time they have ever purchased an NFT. It also appears having a unique digital avatar to use as your profile picture is attractive to many of Reddit's roughly 50 million daily active users. Twitter also allows users to use NFTs as their primary profile image.
"Whether they like to admit it or not everybody likes the idea of rarity, having something no one else has,” said Fleyshman.
Reddit both made a limited-edition collection of avatars available to users and allowed people to purchase avatars, part of The Creator Collection, crafted by individual creators. Users can buy, trade and sell the avatars which are “are powered by non-fungible tokens (NFTs) on the Polygon blockchain.”
Besides potentially onboarding tons of people to web3 by getting them to sign up for their first crypto wallet –called “Vaults” on Reddit— the platform’s avatar strategy has also caused Polygon blockchain volumes to surge in recent days.
Some gaming executives like Stardust co-founder and CEO Canaan Linder believe this direct approach of describing web3 applications with straightforward terms like “collectibles” or “games” will help facilitate a smoother transition into the next era of a blockchain-enabled internet, or web3.
“I think that decontextualization; that these are just games, these are just collectibles, these are just items you can take from one game to another, it is going to make this technology so much more accessible,” said Linder, whose company provides tools for building blockchain games.
“I think what we are starting to see is that how we frame and phrase and deliver that technology, how we speak of it, is just as important as the technology itself,” he also said.
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