Ethereum co-founder Vitalik Buterin has called for a shift in how the network frames the value of ETH, arguing that it should be established as a store of value rather than relying on its identity as a “fee-burning token.” In a post on X on November 8, 2026, Buterin said the burn mechanism should remain, but its role in ETH’s value story should be reduced.
Burn mechanism to stay, but not as core value driver
Buterin endorsed keeping EIP-1559, the mechanism introduced in 2021 that destroys a portion of transaction fees, permanently removing ETH from circulation. However, he wants to retire the idea that the burn is what gives ETH its value.
He argued that holders should not panic if long-term fee burns stay below 10% of the break-even level—the point at which burned fees offset new issuance. That level, he suggested, is sustainable within Ethereum’s broader economic picture. In other words, the burn does not need to cancel out new issuance for ETH to function as an asset.
Buterin also challenged the historical record, stating that the heavy fee burns seen from 2021 to 2023 came largely from activity inside the crypto ecosystem itself. As a result, they should not be interpreted as a true valuation floor for ETH.
The 700,000 ETH estimate and centralization risk
The most striking part of Buterin’s argument is a rough estimate: to support ETH’s current market cap of roughly $270 billion through an in-protocol funding model, the network would need around 700,000 ETH annually. Buterin warned that aggressively chasing fee burns to achieve this could push Ethereum toward centralization. A protocol-level funding scheme of that scale, he argued, would threaten the project’s principles of decentralization and governance.
Recent figures show how far the burn is from doing heavy lifting. Fee burns have accounted for only about 2.07% of new ETH issuance, meaning the total ETH supply has been growing on net.
Why store of value, and why now
Buterin’s case for the store-of-value framing rests on Ethereum’s existing strengths. He tied it to the network’s core strength in decentralization, arguing that this offers a kind of pragmatic stability that holders value. He also pointed to the coming era of AI-driven disruption. In a world where technology may upend many existing systems, an asset anchored in a decentralized network could be appealing precisely because it does not depend on any single company or institution.
This is not the first time Buterin has weighed in on what supports ETH’s value. In 2025, he discussed backing ETH’s value through scaling solutions and incentives tied to Layer 2 networks—the faster, cheaper chains that settle back to Ethereum. The latest commentary builds on that thinking but notably dials down the role of fee burns. As more activity moves to Layer 2s, fewer fees land on the main chain, and the burn naturally gets smaller.
What this means for ETH holders
For investors, the most immediate takeaway is a change in which numbers matter. If ETH’s value story moves away from fee burns, daily burn dashboards and short-term transaction spikes could lose some of their weight in how people assess the asset.
There is a tension worth watching: a store of value with net supply growth has to convince people it is worth holding for reasons other than scarcity. Bitcoin leans heavily on its fixed supply. ETH, under Buterin’s framing, would be leaning on decentralization and credible neutrality instead.
Buterin’s 700,000 ETH estimate also sets up a clear line in the sand for future debates. Any proposal that tries to fund the protocol through aggressive fee capture will now have to answer his centralization concern directly.
