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In traditional finance, fiduciary duty isn’t just an expectation — it’s a fundamental legal requirement. Executives and board members are obligated to act in the best interests of their shareholders. In this sense, fiduciary duties promote transparency and accountability between companies and their external stakeholders.
Summary
- No accountability today: 95% of 2021 bull market tokens have lost over 90%, with 1.8M collapsing in Q1 2025 alone — a credibility crisis born of unchecked founder behavior.
- Voluntary standards needed: Industry-driven fiduciary ratings, modeled after Moody’s or S&P, could enforce discipline in tokenomics, vesting, liquidity, and disclosure.
- Reputation as currency: Shared founder trust scores, public unlock calendars, and ongoing roadmap audits could reward transparency and penalize exploitative practices.
- The crossroads: Without self-regulation, regulators will impose blunt rules — but fiduciary frameworks could unlock institutional capital and restore trust.
Yet in the world of cryptocurrency, where billions of dollars flow freely into token projects, no comparable fiduciary standard exists. This glaring omission has enabled a culture of unchecked founder behavior, where capital is raised with vague promises and minimal oversight. The result is a pattern of failed token launches from projects that either treat their communities as little exit liquidity or neglect critical aspects of launch strategy. Regardless of intention, the common end result is suboptimal token performance, and no recourse for tokenholders when roadmaps vanish, liquidity dries up, and incentives collapse.
If crypto is serious about evolving into a credible, investable asset class, it must embrace the core principle that has underpinned financial markets for centuries: accountability to those who provide capital. That begins with adopting fiduciary standards.
