V God supports low-risk DeFi: The Ethereum ecosystem needs a "stabilizer" rather than meme coins

Ethereum co-founder Vitalik Buterin recently posted an article advocating for the community to re-examine the direction of ecosystem development, emphasizing that we should not be swayed by the short-term hype of meme coins. In his view, low-risk DeFi protocols are the true pillars of Ethereum’s long-term prosperity—these seemingly less “exciting” applications can instead continuously provide economic blood flow for those innovative projects on the internet that are modest in profit but vital.

Lessons from the Google Advertising Empire: Stable Business Supports Innovative Dreams

V神 in his latest blog cited a thought-provoking case: Google.

He pointed out that Google’s advertising business accounts for over three-quarters of its total revenue, serving as this massive “cash cow” that enables Google to invest in those profit-light but “interesting and valuable” product lines for the world. According to V神’s logic, the role of low-risk DeFi for Ethereum can similarly serve as this kind of foundation.

V神 emphasizes that other types of applications—including non-financial sectors and more experimental projects—are undoubtedly crucial to Ethereum’s global standing and unique culture, but we should not expect them to become the main revenue engines. In other words, the “infrastructure” that carries value and the “testing grounds” that inspire innovation need clear division of roles.

From Skepticism to Recognition of DeFi: Are Risks Truly Lowered?

V神 admits he was once skeptical of DeFi. In the early days, he believed DeFi was too risky, overly indulging in speculative asset trading and high-risk “yield farming,” making sustainable use cases difficult to form.

The sale of virtual land Otherdeed by Yuga Labs, the parent company of Bored Ape Yacht Club (BAYC), in 2022 exemplifies this chaos. Due to poor smart contract optimization, intense “Gas wars” broke out among bidders, once setting a historic high for Ethereum’s single-day transaction fees—an extremely painful lesson.

However, the situation has subtly shifted. With technological progress and the maturing of global regulatory frameworks, chaos such as hacking attacks and asset losses are gradually being pushed to the ecosystem’s margins, mostly concentrated among more speculative user groups. V神 believes that although tail-end risks still require vigilance, for many people around the world, the tail-end risks of traditional finance (TradFi) are now greater than those of DeFi. This does not mean DeFi is invulnerable, but the risk landscape is being reshaped.

The Embarrassment of Meme Coins: Ecosystem Value Should Not Be Built on “Taboo” Assets

V神 does not name names explicitly, but his critique is aimed at blockchain ecosystems whose fee revenue is dominated by meme coins. He raises a seemingly simple yet thought-provoking question:

Ethereum’s revenue engine does not have to be the most revolutionary or exciting applications, but at least it should be “morally acceptable” or “not embarrassing.” If the largest application in an ecosystem is a political meme coin, yet it still claims to be “excited about this ecosystem” or “changing the world,” it’s unlikely anyone would openly say so.

This reflects V神’s deep reflection on the ecosystem’s value orientation: a project’s foundation should not be built on hard-to-justify speculative assets, but rather on applications with broad recognition and practical value.

Imagining the Future of Low-Risk DeFi: Beyond the US Dollar

V神 further elaborates on the evolution space for low-risk DeFi in the future. Besides existing models like payments, reserves, and full-collateralized lending, future developments may include:

• Personal credit-based non-collateralized loans: Breaking through the limitations of pure asset collateralization
• Deep integration of prediction markets and DeFi: Incorporating market prediction functions into existing DeFi structures
• Beyond the US dollar for stable value forms: Developing “parity coins” linked to inflation, providing inflation-resistant stores of value

V神 concludes that low-risk DeFi is already supporting Ethereum’s economic operation. It not only makes the current world better but also creates synergistic effects with many experimental applications being built on Ethereum. This is a project everyone can be proud of—not because it is the most sexy or innovative, but because it is solid and resilient.