Source: Cointelegraph
Original: “Ecosystem Health is the Missing Link for Long-Term Success in Blockchain”
Author: Anoop Nannra, Co-founder and CEO of Trugard Labs.
The blockchain world has been battling fraud. For decades, the traditional financial system has created a significant wealth gap, eroded trust, and— as we saw during the 2008 financial crisis—brought us opaque, complex investment products with no accountability.
Blockchain and Web3 were supposed to fix all this, but the reality is that scams like "exit scams" and opaque smart contracts remain focal points in discussions about trust and security.
However, the fact is: our focus is misaligned. Most current efforts are concentrated on chasing fraudsters, tracking anti-money laundering transactions, and marking high-risk smart contracts.
These tools do help people avoid financial losses, but they do not address the root problem.
They are merely responding to surface phenomena. Fraud continues to emerge because a more fundamental issue—the health of the ecosystem—has been overlooked. If the foundation is not solid, bad actors will always find a way in.
Instead of solely focusing on identifying fraud, we need to broaden our perspective and ask: Is the ecosystem truly healthy?
Have we attracted the right builders, tools, and community? Because if the system itself is not stable, we are merely patching holes while the entire infrastructure is gradually collapsing.
Blockchain networks are not just a simple collection of projects. They are active ecosystems composed of developers, tools, users, and shared rules. A healthy ecosystem can attract quality projects and top talent, thereby strengthening the entire network. Collaboration among developers increases, tools are continuously optimized, ultimately benefiting all participants.
Conversely, an unhealthy ecosystem becomes a paradise for fraudsters. If a network has loose rules, outdated development tools, or suffers from a tarnished reputation due to hosting dubious projects, it will fail to attract developers who wish to build long-term sustainable and legitimate projects.
Such an environment instead becomes a breeding ground for fraud, ultimately driving away quality projects and weakening the entire ecosystem. This vicious cycle not only harms user interests but also undermines trust in blockchain technology as a whole.
Even more severely, these troubled networks often become testing grounds for vulnerabilities and scams, which then spread to other blockchain networks.
Take Ethereum (ETH) as an example. Over the years, it has successfully built a robust ecosystem characterized by open-source tools, transparent operations, and high developer engagement.
We now have an environment where innovation can thrive; although scams still exist, they struggle to dominate. The difference is evident when compared to networks filled with low-quality projects and malicious actors: ecosystem health is indeed crucial.
To improve the quality of blockchain networks, we need to assess their overall health rather than just focusing on the number of scams they host or the total value locked and liquidity attracted.
We need to establish a framework for measuring quality and reliability, similar to the mature standard systems developed in manufacturing or cybersecurity industries.
In the blockchain space, we must focus on key indicators such as transparency, developer reputation, security practices, and community engagement.
If most smart contracts on a network lack publicly reviewable source code, how can we be sure these contracts are safe and reliable? Open-source code allows the community to verify system operations and identify potential risks before issues escalate.
Of course, this is different from the billions of lines of open-source code in Web2 projects. In Web3, despite our advocacy for transparency, less than 1% of the source code in deployed smart contracts is available for review.
A strong and active community can have a decisive impact. A user base that actively participates in governance, demands transparency, and holds developers accountable can create an environment where fraud struggles to take root.
While we can widely observe this phenomenon in legitimate projects, the reality is that the cost of forming bot networks to create a false sense of community is too low and the operation is too simple, creating conditions for fraud.
Ecosystem health is not just about preventing fraud—it is about the future development of blockchain. Healthy ecosystems can not only survive—they can continuously grow, drive innovation, thrive, and earn trust. They provide developers with the tools needed for success while assuring users that they are participating in a reliable and secure system.
Currently, we lack effective collaboration. Protocol teams, developers, and security platforms must work together to establish unified standards, rather than waiting for external rules to be enforced or passively accepting rules in the absence of industry participation.
Transparency must be a top priority. Open-source should become the norm rather than the exception. While we cannot expect all projects to disclose their intellectual property, proven technologies that have made significant progress should be actively explored and applied for security assurance.
Security must be integrated into the entire development process, not treated as a remedial measure afterward. The community must urge projects to take responsibility, ensuring that malicious actors cannot operate in an unmonitored environment. Even the most advanced technology requires trust to succeed. By focusing on ecosystem health, we can build safer, more resilient, more innovative, and more sustainable networks. It is time to move beyond the focus on scams and look towards a grander vision for blockchain.
Perspective from: Anoop Nannra, Co-founder and CEO of Trugard Labs.
Related: Bitcoin (BTC) Decentralized Finance (DeFi) Takes Center Stage
This article is for general reference only and should not be considered legal or investment advice. The views, thoughts, and opinions expressed in the article are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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