Reddit Stock Jumps After OpenAI Partnership Announcement

YEREVAN (CoinChapter.com) — Reddit’s stock RDDT jumped 15.90% in the week ending May 17, with investors picking their bullish cues from its data-sharing agreement with OpenAI, the creator of the artificial intelligence chatbot ChatGPT.

The partnership will enable OpenAI tools to better understand Reddit content and showcase it on its platform.

In return for sharing its data, Reddit will benefit from new AI-powered features provided by OpenAI. These tools are designed to strengthen user engagement on the platform. OpenAI’s AI capabilities will support Reddit users and moderators with features aimed at enhancing their overall experience.

Reddit Stock Fundamentals Are — At Best — Awkward

Reddit’s deal with OpenAI comes amid mounting legal challenges faced by AI firms over their data-gathering practices. Lawsuits allege that companies like OpenAI have illegally used copyrighted content and private information to train their models.

For instance, on May 16, Sony sent letters to over 700 firms, including OpenAI, Microsoft, and Google, accusing them of unauthorized use of its music to train AI models.

On the other hand, Reddit focuses on developing alternative revenue streams. For instance, the company previously introduced a blockchain-based rewards service called Community Points but discontinued it last October due to scalability issues.

In addition to its data-sharing agreements, Reddit holds Bitcoin and Ether in its cash reserves and allows users to pay for certain virtual items using Ether and Polygon’s MATIC.