Source publication time: November 8, 2026, at 23:51:15 UTC+8.
Ethereum co-founder Vitalik Buterin argued that ETH’s store-of-value case should take priority over efforts to maximize transaction-fee burning. For validators, his argument draws a distinction between retaining Ethereum’s existing fee-burn mechanism and changing protocol economics to pursue a larger burn.
According to The Block’s November 8 report, Buterin said in a Sunday morning X thread that decentralization, censorship resistance, privacy and security provide a stronger foundation for Ethereum than treating ETH primarily as a fee-burning token.
Keep EIP-1559, without making burn the objective
Buterin supported retaining EIP-1559, the 2021 upgrade that burns part of every transaction fee. His argument was not that Ethereum should abandon the mechanism, but that holders should not judge the network primarily by whether burning offsets new ETH issuance.
“We should not feel sad if fee burn is < 10% of breakeven indefinitely; the value of ETH comes from elsewhere,” he wrote.
He challenged the valuation model behind the “ultrasound money” thesis popular during the 2021 bull market. Under that model, annual token burning divided by a discount rate establishes an apparent valuation floor: burning $1 billion annually at a 4% discount rate would imply $25 billion.
Buterin argued that this was never a reliable floor because much of the burn from 2021 through 2023 came from crypto-internal activity. Revenue from those activities could fall alongside ETH’s price rather than provide independent support.
He cited a sale that burned $180 million in fees in one day, describing it as a “digital monkey sale.” The Block clarified that the event was actually Yuga Labs’ sale of Otherdeed NFTs representing land in the Otherside metaverse.
The report’s data illustrated the subsequent decline: Ethereum burned about 1.48 million ETH, worth roughly $3.6 billion, in 2022, compared with about 19,200 ETH, or $43 million, during 2026 up to the report’s publication.
Buterin said tokenized real-world assets give Ethereum a stronger claim to externally backed activity. However, he argued that a mature business of that kind is unlikely to generate comparable fee spikes.
Validator revenue: a hypothetical cost, not an adopted change
Buterin also questioned what Ethereum would need to spend to justify its valuation through fee burning alone.
Using an ETH market capitalization of approximately $270 billion, he compared Ethereum with L’Oreal. Citing an AI estimate that the company spends around 0.58% of its market capitalization on annual research and development, he argued that matching that rate would exhaust the Ethereum Foundation’s resources almost immediately.
His hypothetical alternative was roughly 700,000 ETH annually in protocol-level funding, which he said would cut validator revenue by two-thirds. This was an illustration of the costs of a burn-focused strategy, not an announced funding mechanism or an implemented reduction in validator revenue.
Buterin further argued that maximizing burn would require highly interventionist governance over the long term, conflicting with decentralization and resistance to capture. Pursuing higher gas prices could also exclude users, including those with a strong need for privacy and security.
A separate validator-reward burn proposal was withdrawn
The thread followed the withdrawal of EIP-8363 from consideration for the forthcoming Hegota upgrade about five weeks earlier. Unlike the existing transaction-fee burn, that proposal would have burned an increasing share of validator rewards as more ETH was staked.
Its authors cited concerns about a high staking ratio’s effect on “ETH’s role as money.” The proposal faced opposition from SharpLink CEO Joseph Chalom and Aave founder Stani Kulechov.
The Block reported that the authors planned a separate issuance process running through EthCC in April. Their withdrawal from Hegota consideration should not be confused with an activated protocol change. At the time of the report, Hegota was expected to follow the delayed Glamsterdam hard fork.
Resilience as the store-of-value test
For Buterin, the first store-of-value requirement is survival. He linked that priority to post-quantum security, partial ossification of the base layer and a high threshold for adding new precompiles or protocol-level rewards.
He highlighted multisignature wallets, the Kohaku privacy project, the FOCIL censorship-resistance proposal and lightweight nodes as relevant work. He also said his laptop node had synchronized in under six hours and occupied one-eighth of its hard drive.
Growth in assets issued directly on Ethereum’s base layer could reinforce ETH’s store-of-value role, he argued, by expanding its uses, including as collateral. His broader position was that Ethereum’s durability and usefulness—not a requirement to maximize burn—should guide its development.