Buterin pitches ETH as a store of value, not a fee-burning token

Ethereum co-founder Vitalik Buterin has urged the community to pitch ETH as a store of value, not as a token that gains from burning fees. It is a change of story for an asset whose investment case rested on fee burning for three years. To see why the shift stands out, you need to look at how the burn model works.

What exactly did Buterin write?

In a thread on X, Buterin said the image of ETH as a fee-burning token turned out weaker than it looked. In his view, optimizing for that scenario hurts decentralization and the network's resistance to capture.

By his logic, the value of ETH should rest on the stability that comes from a focus on decentralization and the CROPS principles (censorship and capture resistance, open source, privacy, security). Buterin believes these qualities will be valued most in an era of AI.

A store of value is an asset that keeps its purchasing power over time, like gold. For Bitcoin it is the main argument, since supply is capped at 21 million coins.

"The idea of ETH as a fee-burning token never was as strong as it seemed."

Vitalik Buterin, from a thread on X, November 8, 2026

How did fee burning work?

In 2021 the EIP-1559 upgrade changed how transactions are paid for. The base fee, which depends on network load, stopped going to validators and started being destroyed. When many people use the network, more ETH is burned than issued, and total supply shrinks.

Here is how that looked in practice.

• The base fee rises with demand for block space and is burned in full.
• Tips to validators stay with them.
• In peak months the burn outpaced new issuance, and ether turned deflationary.
• Supporters, including the hosts of the Bankless podcast, called it "ultrasound money".

Why did the model stop working?

Burning depends on high fees, and fees have collapsed. From January to October the median fee per transaction fell from 35 cents to 3.5 cents. Daily transaction counts rose by more than half over the same period.

It is a paradox. Activity grows, yet less gets burned, because each operation costs next to nothing. Because of the network's design choices, fee revenue keeps falling, and the deflation story in its old form can't carry the load.

How did Bitcoiners and rivals react?

Some Bitcoin supporters, for whom the store-of-value title is nearly sacred, answered sharply. Held Media founder Dan Held wrote that ETH is hopping onto someone else's narrative after all its earlier ones collapsed. A protocol with a shifting monetary policy, he added, cannot be sound money.

Buterin's supporters disagree. Ethereum has not changed its monetary policy since the Merge in 2022, and every change only reduced issuance. MetaLeX attorney Gabriel Shapiro called the statement a moment of nature healing and said ETH can be a better store of value than both ZEC and BTC.

Solana co-founder Anatoly Yakovenko agreed that fees can't be the product. Then he took a quick jab at Ethereum's own "product".

What does this mean for ether holders?

A narrative does not move the price by itself. At the time of writing ETH traded near $2,125 after a drop of almost 5%, while bitcoin stayed below $76,000 after the selloff in AI stocks.

Buterin's line has a technical follow-up. Ethereum Foundation researcher Justin Drake told Devcon 8 in Mumbai that December 2028 is the target for finishing the post-quantum and post-AI transition, a year earlier than the foundation's previous deadline.

The practical takeaway for holders is this: judging ether by its burn rate no longer works. What remains is protocol stability, decentralization and the market's willingness to pay for them. How much it will pay is still unclear.