{"id":25108,"date":"2026-11-08T20:29:02","date_gmt":"2026-11-08T20:29:02","guid":{"rendered":"https:\/\/cryptoted.net\/index.php\/2026\/11\/08\/ethereum-co-founder-vitalik-buterin-backs-eth-as-store-of-value-over-fee-burns\/"},"modified":"2026-11-08T20:29:02","modified_gmt":"2026-11-08T20:29:02","slug":"ethereum-co-founder-vitalik-buterin-backs-eth-as-store-of-value-over-fee-burns","status":"publish","type":"post","link":"https:\/\/cryptoted.net\/index.php\/2026\/11\/08\/ethereum-co-founder-vitalik-buterin-backs-eth-as-store-of-value-over-fee-burns\/","title":{"rendered":"Ethereum co-founder Vitalik Buterin backs ETH as store of value over fee burns"},"content":{"rendered":"<p> <br \/>\n<br \/><img decoding=\"async\" src=\"https:\/\/media.crypto.news\/2024\/03\/crypto-news-Vitalik-Buterin-option002.webp\" \/><\/p>\n<div>\n<p class=\"is-style-lead\">Ethereum co-founder Vitalik Buterin has argued that ETH should be valued primarily as a store of value rather than through transaction-fee burning, questioning a long-standing investment argument built around the cryptocurrency becoming increasingly scarce.<\/p>\n<div id=\"cn-block-summary-block_449ad6d63e5a47eaff125f16104a279a\" class=\"cn-block-summary\">\n<p>\n        <span class=\"tabs__item is-selected\">Summary<\/span>\n    <\/p>\n<div class=\"cn-block-summary__content\">\n<ul class=\"wp-block-list\">\n<li>Vitalik Buterin argues ETH should prioritize store-of-value properties over maximizing network transaction fee burns indefinitely.<\/li>\n<li>Buterin says Ethereum should retain EIP-1559 even when fee burning fails to offset token issuance.<\/li>\n<li>Ethereum\u2019s decentralization, censorship resistance, privacy and security underpin Buterin\u2019s preferred long-term ETH investment case today.<\/li>\n<li>Buterin argues maximizing Ethereum transaction fees could undermine affordability, decentralization and resistance to external capture.<\/li>\n<li>Ethereum\u2019s layer-two growth has reduced mainnet fee burning while developers continue advancing privacy and security.<\/li>\n<\/ul><\/div>\n<\/div>\n<p><!-- .cn-block-summary --><\/p>\n<p>In a <a href=\"https:\/\/x.com\/VitalikButerin\/status\/2119401255919604064\" target=\"_blank\">post<\/a> on X, Buterin said Ethereum should focus on decentralization, security and resistance to outside control instead of maximizing the amount of ETH destroyed through network fees. He maintained that EIP-1559 should remain in place but questioned whether fee burning could reliably support the asset\u2019s valuation.<\/p>\n<figure class=\"wp-block-embed is-type-rich is-provider-x wp-block-embed-x\">\n<div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">Expanding on why I believe &#8220;ETH as store of value (SoV)&#8221; makes much more sense to focus on than &#8220;ETH as fee-burning token&#8221;.<\/p>\n<p>Three primary reasons:<\/p>\n<p>1. ETH as fee-burning token never was as strong as it seemed<br \/>2. Optimizing for ETH as fee-burning token would demand Ethereum and\u2026<\/p>\n<p>\u2014 vitalik.eth (@VitalikButerin) <a href=\"https:\/\/x.com\/VitalikButerin\/status\/2119401255919604064?ref_src=twsrc%5Etfw\">November 8, 2026<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n<p>The comments come as ETH trades near $2,240 and Ethereum continues issuing more tokens than it burns during periods of low network activity. Buterin\u2019s argument places the network\u2019s long-term reliability ahead of efforts to generate higher fees for token holders.<\/p>\n<h2 class=\"wp-block-heading\"><strong>Vitalik Buterin Questions Ethereum\u2019s Fee-Burning Valuation<\/strong><\/h2>\n<p>Buterin challenged the economic reasoning behind treating ETH like an asset whose value can be calculated from a predictable stream of fees.<\/p>\n<p>The argument assumes that the value of burned tokens can support a cryptocurrency\u2019s market capitalization, much as recurring income can support the valuation of a business.<\/p>\n<p>In his <a href=\"https:\/\/x.com\/VitalikButerin\/status\/2119401300723118086\" target=\"_blank\">explanation<\/a>, Buterin used an example involving $1 billion in annual token burns and a 4% discount rate. Under that calculation, the recurring burn could theoretically justify a $25 billion valuation.<\/p>\n<p>However, he argued that such calculations depend on fee revenue remaining stable even when the underlying token loses value.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cETH as fee-burning token never was as strong as it seemed,\u201d Buterin wrote, pointing to the large amounts of Ethereum activity driven by cryptocurrency speculation.<\/p>\n<\/blockquote>\n<p>During 2021\u20132023, network users burned millions of ETH through transaction fees, including periods of intense demand for NFT trading and decentralized finance.<\/p>\n<p>Buterin argued that much of this activity depended on wealth already circulating within cryptocurrency markets. A steep decline in ETH prices could therefore reduce the spending that generated those fees.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p>\n<p>He acknowledged that tokenized real-world assets now provide Ethereum with more financial activity connected to conventional markets, although he did not expect mature financial products to reproduce the extreme fees associated with speculative NFT trading.<\/p>\n<h2 class=\"wp-block-heading\"><strong>Higher Ethereum Fees Could Conflict With Decentralization<\/strong><\/h2>\n<p>The second part of Buterin\u2019s argument concerned what Ethereum would need to become if developers treated fee generation as the network\u2019s primary objective.<\/p>\n<p>He compared the responsibilities of a large revenue-focused blockchain with those of a major corporation, arguing that sustained competition would require extensive development spending and more interventionist governance.<\/p>\n<p>Using a hypothetical funding model, Buterin estimated that Ethereum could require approximately 700,000 ETH annually for protocol research and development if it followed a corporate-style approach.<\/p>\n<p>Such spending would raise questions about who controls the funding and how much validator compensation would remain available.<\/p>\n<p>He argued that maximizing transaction-fee revenue could encourage higher gas prices, making Ethereum less accessible to people seeking privacy and secure financial transactions.<\/p>\n<p>Solana co-founder Anatoly Yakovenko, known as Toly, supported Buterin\u2019s argument in a response on X, despite the two developers leading competing blockchain ecosystems.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cVitalik is absolutely right that you can\u2019t focus on fees as the product. That\u2019s absolutely meaningless,\u201d Yakovenko wrote. <\/p>\n<\/blockquote>\n<p>He argued that blockchain networks should identify the service they want to provide and concentrate on delivering it well, instead of treating fee collection as their main purpose.<\/p>\n<figure class=\"wp-block-embed is-type-rich is-provider-x wp-block-embed-x\">\n<div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">Vitalik is absolutely right that you can\u2019t focus on fees as the product.  That\u2019s absolutely meaningless.  You need to pick a product, the thing that brings value to people, and do that really well. <a href=\"https:\/\/t.co\/ljsytHPheI\">https:\/\/t.co\/ljsytHPheI<\/a><\/p>\n<p>\u2014 toly \ud83c\uddfa\ud83c\uddf8 (@toly) <a href=\"https:\/\/x.com\/toly\/status\/2119418203415998830?ref_src=twsrc%5Etfw\">November 8, 2026<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n<p>The issue has already appeared in debates over Ethereum\u2019s economic model. In August, crypto.news <a href=\"https:\/\/crypto.news\/ethereum-ultrasound-money-l2-burn-broken\/\" target=\"_blank\">examined declining ETH burns<\/a> after the network moved more transaction activity onto cheaper layer-2 systems.<\/p>\n<p>Ethereum\u2019s March 2024 Dencun upgrade reduced layer-2 transaction costs, allowing applications to process activity without generating the same level of mainnet fees.<\/p>\n<p>Consequently, ETH supply has experienced periods of net inflation as newly issued tokens exceeded those removed through EIP-1559.<\/p>\n<h2 class=\"wp-block-heading\"><strong>ETH Store-of-Value Case Centers on Security and Stability<\/strong><\/h2>\n<p>Buterin\u2019s preferred approach places greater emphasis on Ethereum remaining dependable over long periods.<\/p>\n<p>He described the network\u2019s strengths through decentralization and CROPS, referring to censorship and capture resistance, open-source development, privacy and security.<\/p>\n<p>For long-term ETH holders, he argued that the network\u2019s ability to survive technological changes and political pressure should carry more weight than maximizing annual fee burns.<\/p>\n<p>He pointed to conservative protocol development, post-quantum security and efforts to reduce dependence on specialized infrastructure.<\/p>\n<p>Ethereum\u2019s existing development work includes <a href=\"https:\/\/crypto.news\/ethereum-foundation-default-wallet-privacy-kohaku\/\" target=\"_blank\">Kohaku wallet privacy tools<\/a>, which seek to protect transaction information while improving users\u2019 control over their assets.<\/p>\n<p>Buterin identified multisignature wallets, private account abstraction and Fork-Choice Enforced Inclusion Lists as technologies that could support his preferred direction.<\/p>\n<p>The proposed <a href=\"https:\/\/crypto.news\/ethereum-weighs-self-funded-privacy-pools-2027-upgrade\/\" target=\"_blank\">FOCIL transaction mechanism<\/a> would make it harder for block builders to exclude eligible transactions, strengthening censorship resistance.<\/p>\n<p>He maintained that supporting tokenized assets, collateral arrangements and decentralized trading remains compatible with this approach because such services expand what ETH holders can do without requiring Ethereum to maximize fees.<\/p>\n<h2 class=\"wp-block-heading\"><strong>Buterin Says EIP-1559 Burns Should Continue<\/strong><\/h2>\n<p>Buterin made clear that his comments did not amount to a proposal to abandon Ethereum\u2019s existing fee-burning system.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cEIP-1559 (including its burn) is fine and good, we should keep them,\u201d Buterin <a href=\"https:\/\/x.com\/VitalikButerin\/status\/2119401255919604064\" target=\"_blank\">said<\/a>.<\/p>\n<\/blockquote>\n<p>Under EIP-1559, Ethereum destroys the base portion of transaction fees while continuing to issue new ETH to validators. Whether supply rises or falls depends on the balance between those two processes.<\/p>\n<p>Buterin argued that ETH could retain its store-of-value appeal even if fee burning remained below 10% of the amount needed to offset issuance indefinitely.<\/p>\n<p>He connected that position to Ethereum\u2019s long-term security, arguing that institutions and individuals may increasingly value stable, censorship-resistant infrastructure as artificial intelligence creates new technological risks.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p><\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/crypto.news\/vitalik-buterin-ethereum-eth-store-of-value-fee-burn\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ethereum co-founder Vitalik Buterin has argued that ETH should be valued primarily as a store of value rather than through transaction-fee burning, questioning a long-standing investment argument built around the cryptocurrency becoming increasingly scarce. Summary Vitalik Buterin argues ETH should prioritize store-of-value properties over maximizing network transaction fee burns indefinitely. Buterin says Ethereum should retain [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":25109,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","footnotes":""},"categories":[23],"tags":[],"kronos_expire_date":[],"class_list":["post-25108","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto"],"_links":{"self":[{"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/posts\/25108","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/comments?post=25108"}],"version-history":[{"count":0,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/posts\/25108\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/media\/25109"}],"wp:attachment":[{"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/media?parent=25108"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/categories?post=25108"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/tags?post=25108"},{"taxonomy":"kronos_expire_date","embeddable":true,"href":"https:\/\/cryptoted.net\/index.php\/wp-json\/wp\/v2\/kronos_expire_date?post=25108"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}