Literally dead wrong on both points. I worked in anti-fraud at Airbnb before I got into crypto. So I often shared notes with people who worked in anti-fraud at Uber. Uber gave up their China business because they were beset with waves of professionalized fraud rings, taking thousands of fake rides a month to farm Uber incentives. Uber was quite literally farmed out of business in China. Every tech company that offers incentives has to police fraud, and they expect some amount of waste that gets captured by fraudsters (in crypto we call them "farmers"). The idea that this is unique to crypto is silly. Many, many web2 startups have gone out of business because they failed to put a lid on incentive abuse, while investors were told they were "subsidizing demand." Part 2 of Gwart's claim is that in crypto, these incentives are given out "at 0 cost," while in web2 companies, "VCs are burning real cash." Stop and think for a second. What do farmers get if they are dumping your token incentives? They are selling it for cash. So, in web2: equity => sell for cash to private investors => give cash to user => user gets cash web2: tokens => give user tokens => user dumps tokens => user gets cash It's the same damn thing, you're just skipping a middleman. Markets evolve through trying shit and learning from failure. There is good spend and bad spend. To the extent that crypto startups previously thought spending a lot of money on short-term incentives was effective, they have now learned that it isn't, and they adapt. Same thing was learned in the "gig economy" era where a bunch of companies went bust, and the ones that survived learned how to keep economics sustainable.