NEW YORK (InsideBitcoins) — Reddit wants to give its users some credit for its success. As a part of its freshly minted $50 million in Series B venture financing, CEO Yishan Wong said the company’s investors are looking to give 10% of the shares back to the reddit community, possibly in the form of its own cryptocurrency.
Wong said in a blog post, “we are thinking about creating a cryptocurrency and making it exchangeable (backed) by those shares of reddit, and then distributing the currency to the community.”
The “front page of the Internet” garnered a $500 million valuation from the investment led by Sam Altman, CEO of Y Combinator, along with participation by Andreesen Horowitz, Sequoia Capital, and a slew of individual investors.
“The investors have explicitly agreed to this in their investment terms,” Wong said in his post. What will happen is that the $5 million in shares will be used to back the coins which will then be distributed to the users.”
Naturally, this brings up a lot of issues as to legality, but Wong has already consulted with an ex-SEC lawyer and while he has yet been unable to find anything illegal about the plan, he says there are over 30 steps between now and getting the users their coins. The value of these potential “Creddits” (as one member suggested) would be directly tied to the value of the stock. As the value of the company increases, the value of each of those coins would also increase — which users would then be able to buy, sell, and trade.
This is meant as a reward for those that have contributed so much to Reddit’s growth. Wong said that it had always been a dream to give members of the community equity in the growing company because they are the reason it has grown to such an enormous value. Because of that, some members will likely receive more equity because of their contributions.
Wong warned: “Again, we want to emphasize that this plan is in its earliest stages right now and could totally fail (if it does, we will find another way to get the shares to the community somehow), but we are going to try it because… well, because we are reddit and we do these kinds of things.”