Originally published by Decrypt on November 10, 2026, at 01:14:10 UTC+8. This article preserves that reporting context.
Ethereum co-founder Vitalik Buterin argued that ETH’s value should rest less on transaction-fee destruction and more on its properties as a store of value. The distinction changes the valuation question: rather than asking how much ETH the network burns, investors would need to assess whether decentralization, censorship resistance and security support durable demand for the asset.
In a November 8, 2026, post, Buterin said the fee-burning thesis was “never” as strong as it appeared. His argument challenges the emphasis behind Ethereum’s “ultrasound money” narrative, though it does not establish a replacement valuation model or price target.
Why fee burns are not a guaranteed valuation floor
Ethereum began burning a portion of transaction fees in 2021. The associated investment argument was that greater network usage would remove more ETH from circulation, supporting its price through reduced supply.
Supporters also treated fees as a potential valuation anchor, drawing an analogy with corporate revenue and profits. Buterin disputed the strength of that comparison. According to Decrypt, Ethereum burned millions of ETH annually from 2021 through 2023, but Buterin said this was “never a true floor”: much of the burn came from crypto-internal activities such as lending and NFT purchases.
“We should not feel sad if fee burn is < 10% of breakeven indefinitely; the value of ETH comes from elsewhere,” he wrote. The supplied report does not define the breakeven measure behind that comparison.
Connor Howe, co-founder and CEO of infrastructure provider Enso, told Decrypt that Ethereum’s layer-2 expansion had further weakened the fee-burning argument. A significant portion of activity had moved to layer-2 networks, he said, where users pay “almost nothing” to settle transactions.
That separates three concepts that a valuation argument should not conflate: network activity, fees generated and the resulting reduction in ETH supply. More activity alone does not establish how much value accrues to ETH holders through burning.
The trade-off in maximizing fees
Howe also identified a tension between maximizing burns and making Ethereum inexpensive to use: optimizing for fee destruction would mean seeking higher gas prices, which users do not want.
Buterin framed the issue in terms of Ethereum’s purpose:
“If we decide we actually want to optimize ETH for burning fees to justify a present-day ~$270B market cap, then Ethereum would essentially be functioning as a world-scale major corporation.”
The roughly $270 billion figure was the market capitalization cited in his argument at the time—not a fair-value estimate. Buterin argued that pursuing such a corporate-style objective would compromise decentralization, one of Ethereum’s central selling points.
What the store-of-value thesis depends on
Buterin instead emphasized stability grounded in decentralization, censorship resistance and strong security. That is an argument about the durability of Ethereum’s underlying properties, not evidence that ETH’s market price will remain stable.
Binji Pande, a founding member of Ethlabs, agreed with the shift. He told Decrypt that Ethereum was positioned as a “future-proof store of value,” citing censorship resistance, broad availability, distribution and its role in tokenization, stablecoins and decentralized finance.
Pande also argued that ETH compared favorably with gold and Bitcoin. In his view, gold’s physical storage requirements and limited portability make it less suited to a globalized world. He questioned Bitcoin’s preparedness for AI-related and quantum-computing threats, while presenting Ethereum’s security work as an advantage. Those comparisons are Pande’s assessments, not demonstrated conclusions about future asset performance.
Decrypt reported that the Ethereum Foundation formed a dedicated post-quantum team in January 2026 and that researchers had more recently debated potential AI-powered threats. The report described the Bitcoin community as more divided over how to address quantum risks.
Julian Ma, co-founder of Ethlabs, likewise argued that Ethereum’s security culture, preparation and investment in formal verification could strengthen its position as a programmable store-of-value asset as cyberattack capabilities develop.
Distribution supports the argument—but does not settle valuation
Pande said the Ethereum Foundation owned less than 0.2% of ETH and that the token had traded for 11 years. He used those points to argue that newer assets would struggle to establish comparably credible distribution and would risk becoming centralized.
These are inputs to a store-of-value thesis, rather than a calculation of what ETH should be worth. The argument depends on holders continuing to value Ethereum’s security, accessibility and decentralization. The supplied report provides no quantitative model connecting those characteristics to a particular market capitalization.
Howe supported Buterin’s direction but criticized the timing. He said the Ethereum Foundation needed to listen more closely to applications building on the network, adding: “I think he is right, and I think it took too long to say it.”
The central valuation distinction is therefore between supply reduction through fee burns and demand to hold ETH for its monetary and network properties. Buterin’s case shifts emphasis toward the latter; it does not turn either mechanism into a guaranteed price floor.