Binance Founder Proposes New Tokenomics to Reduce Crypto Rug Pulls

TLDR

• Binance founder CZ criticized “degens” for chasing quick gains in crypto instead of focusing on long-term projects
• CZ suggests investors support “ethical teams” building projects with real utility rather than speculative memecoins
• Several high-profile rug pulls and exit scams have resulted in major investor losses in the crypto space
• CZ proposed new tokenomics with strict vesting schedules to prevent rug pulls (only 10% unlocked initially, 5% every six months)
• CZ has raised over $1 million for victims of BROCCOLI and TST memecoin crashes

In recent statements, Binance founder Changpeng Zhao (CZ) has taken aim at the “degen” culture in cryptocurrency investing. He urges investors to shift focus from quick gains to supporting credible projects with long-term potential.

CZ expressed concern about the rush for easy profits in the crypto world. He noted that many investors are putting large amounts of money into highly speculative assets without proper research.

“In crypto, too much money is spent chasing small, quick gains,” CZ stated on X (formerly Twitter). His message comes after several high-profile rug pulls that left investors with heavy losses.

Unpopular opinion:

In crypto, too much money is spent chasing small, quick gains. Focus on ethical teams that build for the long term. Big money is built slowly with stamina.

— CZ 🔶 BNB (@cz_binance) March 9, 2025

The term “degens” refers to crypto investors who take high risks. These traders often invest in low-cap tokens and memecoins, hoping for quick returns without thorough investigation.

CZ advises a different approach for those in the crypto space. He recommends supporting “ethical teams that build for the long term” rather than following short-term hype.

Many investors have lost money through rug pulls and exit scams. These schemes often involve project creators abandoning their projects after raising funds, leaving investors with worthless tokens.

The U.S. Securities and Exchange Commission (SEC) has clarified that memecoins are not securities. They have warned investors about the risks of putting money into such assets.

Building Better Safeguards

CZ has not only criticized problematic practices but also offered solutions. He proposed a new tokenomics model designed to reduce the risk of rug pulls in the ecosystem.

His plan includes strict vesting schedules for new crypto projects. Only 10% of tokens would be unlocked initially, with the remaining 90% subject to specific conditions before release.

The proposed system would unlock just 5% of tokens every six months. Smart contracts would control this vesting schedule, with third parties holding the keys to prevent manipulation.

This approach aims to ensure project founders remain committed. By restricting quick access to tokens, creators have incentives to work toward long-term success rather than short-term profits.

CZ has shown practical support for those affected by crypto scams. He has helped raise over $1 million for victims of the BROCCOLI and TST memecoin crashes.

The Binance founder also commented on integrating new technologies. He suggested that AI projects can use Layer 1 and Layer 2 blockchains to meet both efficiency and decentralization goals.

CZ’s comments reflect growing concerns about investment practices in crypto. As the market has seen increased volatility, calls for more responsible investing have become louder.

The warnings from such a major figure in the industry highlight the risks. They serve as a reminder that sustainable growth requires moving beyond the “get-rich-quick” mentality that has dominated parts of the crypto world.