Source published: November 9, 2026, at 09:54:49 UTC+8. This article summarizes the argument attributed to Vitalik Buterin in Odaily’s report, rather than an activated protocol change.
Ethereum should put greater emphasis on ETH as a store of value, rather than treating transaction-fee burning as its principal valuation anchor, according to an Odaily translation of remarks by Vitalik Buterin on X.
His argument is not to remove EIP-1559 or its burn mechanism. Both should remain, he said, but ETH could derive value from other sources even if the amount burned stayed below 10% of new issuance over the long term.
Why fee burning offers an uncertain valuation floor
The argument begins with a simplified net-present-value model:
Market capitalization = annual value of fees burned ÷ discount rate.
A token that reliably burns $1 billion a year indefinitely would, at a 4% discount rate, have an implied valuation of roughly $25 billion. In that model, a lower price could allow investors to buy tokens and sell a portion each year while maintaining their share of the remaining supply and earning above the market benchmark.
Buterin questioned whether Ethereum’s historical fee revenue could support such a dependable floor. Although substantial amounts of ETH were burned between 2021 and 2023, much of that activity came from within the crypto economy. If ETH’s price fell to one-tenth of its previous level, participants’ ability to pay—and the revenue generated by those activities—could also fall.
That weakness applied both to NFT buying frenzies, which once burned approximately $180 million in fees in a single day, and to more routine lending activity. Demand originating outside crypto markets would provide a more convincing foundation, he argued.
Real-world assets, or RWAs, could help supply that external demand. However, mature, stable businesses would be unlikely to reproduce the extraordinary daily fee spending seen during speculative booms.
The governance cost of maximizing the burn
Using fee burning to justify ETH’s roughly $270 billion market capitalization at the time of the source’s account would, in Buterin’s comparison, require Ethereum to operate at the scale of a major global company such as L’Oréal.
The comparison raises two concerns: sustained spending and interventionist governance.
Citing an AI-generated estimate that L’Oréal’s annual research and development spending amounted to about 0.58% of its market capitalization, the argument considers what a comparable commitment would mean for Ethereum. The Ethereum Foundation’s funds would quickly be depleted, potentially requiring around 700,000 ETH a year in protocol-funded support and reducing validator income by approximately two-thirds. Those figures are estimates within a hypothetical scenario, not an adopted funding plan. They also cover only research and development, not the full costs of remaining competitive.
A corporate-style strategy would also require ongoing decisions about markets, products and changing user needs. Buterin argued that allocating large sums and maintaining highly interventionist governance would create political pressures rather than strengthen decentralization and resistance to capture.
There is a separate access trade-off: pursuing more fee burning can mean pursuing higher gas prices. That could exclude users, including those who most need privacy and security. Maximizing price multiplied by usage is not the same objective as allowing as many people as possible to use Ethereum within safe resource limits.
A store-of-value roadmap prioritizes survival
Buterin identified decentralization and CROPS—censorship resistance, capture resistance, open source, privacy and security—as central reasons people value Ethereum. These properties also matter to institutions, where privacy can involve risk management and data-protection compliance rather than an abstract preference.
For someone holding ETH primarily to store value, he argued, the key measure is whether the network can survive over the long term. That points toward several protocol priorities:
- Making cautious security trade-offs and taking changes associated with quantum computing and AI seriously.
- Gradually stabilizing the core protocol once completed, with more innovation moving to higher layers.
- Setting a high threshold for features that add protocol complexity and reward mechanisms that could be captured by interest groups.
- Enabling users to hold assets safely and privately, with confidence that block builders cannot prevent their transactions.
- Reducing dependence on infrastructure providers.
He cited multisignature tools, privacy tools, privacy account abstraction and FOCIL as work serving those objectives. The account does not establish their respective deployment or activation status.
As an example of independent node operation, Buterin said he could run a node on his laptop, synchronize it in under six hours and use roughly one-eighth of its disk space—an improvement over his experience in 2019.
Application growth can reinforce ETH’s utility
The store-of-value argument does not exclude application growth. Buterin argued that more RWAs issued natively on Ethereum L1, alongside decentralized assets, could make ETH more useful to hold: users could exchange it for other assets securely and without trust, or use it as collateral in a wider range of activities.
Those uses still involve decentralization trade-offs. Shorter block intervals, for example, could create centralization pressure. But he described the overall conflict as smaller than that created by pursuing maximum fee revenue.
The distinction is between a proposal for Ethereum’s priorities and a concrete network upgrade. The source presents a case for grounding ETH’s store-of-value role in Ethereum’s decentralization, privacy, security and durability—not an announcement that EIP-1559 has changed.
Original article: Odaily. Original author credited: Vitalik Buterin; Chinese compilation by Odaily, translated by Asher.