Ethereum (ETH) co-founder Vitalik Buterin believes decentralized finance (DeFi) projects need to demonstrate that they are “sustainably useful” without sacrificing core principles like permissionlessness and decentralization.
Buterin says on social media platform X that he is a fan of decentralized exchanges (DEXs) and uses them every week, and he says decentralized betting platform Polymarket “is awesome.”
He also likes decentralized stablecoins, mentioning RAI, a crypto asset backed by ETH, in particular.
Additionally, Buterin praises the USDC stablecoin, which aims to maintain a 1:1 ratio against the US dollar.
“I think USDC is less awesome than RAI, but from a practical standpoint we just have to respect the fact that it’s incredibly practical and a lot of people use it.
It’s incredibly useful for me personally when making international donations, much more convenient than banking.
We’re here to try to make the global economy and society more open and free, and people in emerging markets using stablecoins to transact freely is a real use case that’s happening everywhere. USDC on Ethereum is also much better than account-to-account transfers within centralized exchanges, which also happens a lot.
If we get more and more people using USDC, it creates a situation where it becomes easier for people to also move to other, more decentralized stablecoins.
Conversely, Buterin compares liquidity farming to an ouroboros, a symbol of a serpent or dragon eating its own tail.
“The things I don’t respect are essentially things that have their appeal coming from a temporary source that has no sustainability, for example. I didn’t feel any enthusiasm for the liquidity farming craze of the 2021 era because it was obvious that it was coming from token issuances that are inherently temporary.
If people say to me, ‘You can get a good return by putting your coins here,’ my question is always, ‘Where does the return come from? Who are the people on the other side of the transaction, who are paying the return? In cases where there is a specific answer to the question, and there is good reason to believe that it will still be true five years from now, then I am absolutely enthusiastic about that.
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