Vitalik: Good incentives should compensate for temporary costs, and successful applications should focus primarily on developing practicality.

2026-02-12 14:03:40

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Deep Tide TechFlow News, on February 12th, Ethereum co-founder Vitalik Buterin posted on social media, elaborating on his views regarding user incentive mechanisms in crypto projects. Vitalik believes that incentive mechanisms should distinguish between two situations: compensating for temporary costs during the early, immature stages of a project is beneficial, while attracting users who will not use the project once it matures is harmful.

Vitalik pointed out that many decentralized finance liquidity rewards are reasonable because they compensate for risks such as hacks or team fraud in new projects. However, paying users to post tweets to gain attention is a wrong approach, as such incentives may lead users to sacrifice content quality for maximum gains.

He emphasized that an ideal incentive mechanism should precisely compensate for the temporary shortcomings of the protocol, which will disappear as the protocol matures, while not attracting users who are unlikely to stay. Finally, Vitalik stated that successful applications should focus primarily on developing practicality rather than indiscriminately expanding the user base through paying users.

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