Ethereum co-founder Vitalik Buterin has once again sparked debate in the crypto world, this time warning builders not to rely on “pay users or fail” tactics to grow their apps. In a series of posts shared on X, Buterin argued that while incentives can help projects get off the ground, paying people simply to boost activity is not a recipe for long-term success.
According to Buterin, many crypto apps lean heavily on airdrops, token rewards, and social media payouts to attract users. These campaigns can make numbers look impressive in the short term, but they often attract low-quality activity. Once the rewards dry up, so does the engagement. In his view, this creates a false sense of adoption and can mislead teams into thinking they’ve built something people truly want.
That doesn’t mean Buterin is against incentives altogether. He said early rewards can be fair and even necessary in some cases, especially in decentralized finance. For example, liquidity providers who put capital into new protocols are exposed to real risks, including smart contract bugs, hacks, and even complete project failure. Compensating early participants for taking on these risks makes sense during the early, fragile stages of a protocol’s life.
However, Buterin believes these high rewards should naturally fade as projects mature. Once a protocol is audited, battle-tested, and trusted by users, the risks decline — and so should the incentives. Sustainable models, he said, look more like traditional businesses, where revenue from some users is used to fund value for others. This creates a healthy economic loop instead of a constant need to “buy” attention.
He also drew a line between different types of crypto platforms. In decentralized finance, capital is largely interchangeable — one dollar of liquidity is similar to another. But in social platforms and community-driven apps, user quality matters far more than raw numbers. Paying people to post promotional content can flood platforms with noise, not value. When the payouts stop, so does the motivation to contribute meaningfully.
Buterin highlighted the importance of genuine communities. The strongest crypto projects often benefit from contributors who build tools, write documentation, and help others in forums without expecting direct financial rewards. These committed community members tend to stick around and strengthen ecosystems over time.
In his view, the crypto industry is slowly moving away from hype-driven growth toward models rooted in real-world usefulness. The days of launching a token, throwing money at users, and hoping a lasting network forms are fading. “The bulk of the effort should be on making an actually-useful app,” Buterin said, adding that speculative narratives once masked weak products — but that approach no longer works.
The takeaway for Ethereum builders is clear: incentives can help overcome early hurdles, but true adoption only comes when people stick around because the product is genuinely useful.
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