Thomas Daniels
In a recent proposition aimed at enhancing the fairness and communal welfare within the volatile cryptocurrency market, Vitalik Buterin, the esteemed co-founder of Ethereum, has introduced a novel concept dubbed ‘degen communism.’ This innovative idea seeks to marry the daring ethos of ‘degen’ culture, characterized by its pursuit of high-stakes, lucrative investment ventures, with a systematic framework designed to safeguard all participants from the adverse effects of market fluctuations.
At the heart of Buterin’s proposition is a mechanism devised to ensure that, in the event of a hack or the failure of a project, smaller participants receive restitution prior to any consideration of larger stakeholders. Buterin envisions this approach as a step towards a more just and balanced ecosystem, a stance he publicly endorsed in the aftermath of the Terra Luna debacle in 2022. Further, he advocates for the inclusion of this model within the terms of service for projects, stipulating a ‘bottom-up’ prioritization for fund allocation in scenarios of insolvency.
Reflecting on the initial reception to his proposal, Buterin remarks, “Two years ago, my proposal was met with skepticism and misinterpretation, equated erroneously with a call for government bailouts. My proposal, however, is entirely distinct, seeking instead that project teams embed within their terms of service an expectation of this prioritization.” Buterin clarifies that his solitary appeal to government entities involves the establishment of legal frameworks that would recognize and uphold such agreements in bankruptcy proceedings.
Expanding his vision, Buterin also addresses the phenomenon of meme coins, urging these projects to allocate a segment of their issuance to philanthropic endeavors. This gesture, according to Buterin, could imbue these often frivolous cryptocurrencies with a sense of community and collective obligation. Moreover, he champions the idea of airdrops that preferentially benefit individual users and contributors to the public good, alongside governance structures that inhibit the consolidation of influence.
