TLDR
- Vitalik Buterin says ETH should be seen as a store of value, not a fee-burning token.
- He said burns would need to fund about 700,000 ETH a year to justify a $270 billion market cap.
- That funding level would cut validator revenue by about two-thirds, he argued.
- Buterin named decentralization and CROPS as the source of ETH’s stability.
- ETH traded at about $2,237 with a market cap near $273.4 billion, per CoinGecko.
Ethereum co-founder Vitalik Buterin said the network should treat ETH as a store of value instead of a token defined by its fee burn. He shared the view in a post on X on Sunday, November 8, 2026. He said the fee-burn story “never was as strong as it seemed.”
Expanding on why I believe "ETH as store of value (SoV)" makes much more sense to focus on than "ETH as fee-burning token".
Three primary reasons:
1. ETH as fee-burning token never was as strong as it seemed
2. Optimizing for ETH as fee-burning token would demand Ethereum and…— vitalik.eth (@VitalikButerin) November 8, 2026
He did not call for ending the burn. “EIP-1559 (including its burn) is fine and good, we should keep them,” he wrote. He added that people should not feel sad if the burn stays below 10% of breakeven for good.
How the Fee Burn Works
EIP-1559 changed how Ethereum transaction fees work. Each transaction pays a base fee, which the network destroys, and an optional tip that goes to validators. The change went live with the London hard fork on August 5, 2021.
The burn later fed the “ultrasound money” idea. Under it, ETH would become scarcer than Bitcoin if more ETH was burned than issued. Breakeven is the point where burned ETH equals newly issued ETH.
Buterin said the large burns of 2021 to 2023 came mostly from activity inside crypto. Examples include speculative trading and NFT sales. That activity tends to rise and fall with ETH’s price, so the fee revenue can shrink when the price drops.
The 700,000 ETH Math
Buterin used a simple model in which market cap equals fees burned divided by a discount rate. To justify a market cap of about $270 billion through fees alone, he said Ethereum would need to act like a global company. His example was L’Oréal, which he placed near the 55th largest firm by market value.
He estimated L’Oréal spends about 0.58% of its market cap each year on research and development. At that rate, Ethereum would need about 700,000 ETH a year in protocol funding. He said that would cut validator income by roughly two-thirds.
Such a firm also needs constant investment and active management. For Ethereum, that would mean heavily interventionist governance, he said. He added that it would be hard to square with decentralization and censorship resistance.
Chasing higher fee revenue could also push gas prices up. That could price out users who need privacy and security the most.
Stability and CROPS
Buterin pointed instead to decentralization and CROPS. The term stands for censorship resistance, open source, privacy and security. The Ethereum Foundation listed these as core principles in its mandate, published March 13, 2026.
He said these traits translate into stability. “And in the era of AI disruption, stability will be highly valued,” he wrote. For a store of value, he said the most important goal is to survive.
He listed several priorities that fit this focus. They include post-quantum security preparation and partial ossification, meaning the core protocol changes less often. He also named a high bar for new precompiles and in-protocol rewards.
Other items were better tools for holding ETH safely and privately, such as multisig wallets. He also named inclusion lists such as FOCIL, which let validators require that valid transactions enter blocks. He said more real-world and decentralized assets on Ethereum’s base layer could add to ETH’s use.
The comments are an opinion, not a protocol proposal. They do not change Ethereum’s code, and EIP-1559 stays active. They come as developers debate the Glamsterdam upgrade, which some warn could break existing contracts.
Earlier on Sunday, Buterin also posted on AI. He said he does not share the strong emotional reaction against movements opposing new data centers. He argued that slower growth in computing power would give more time to guard against cybersecurity and biological risks.
At the time of writing, ETH traded at about $2,237, according to CoinGecko. Its market capitalization stood near $273.4 billion.
