Ethereum risks falling to $1,970 as Buterin challenges ETH fee-burning narrative

Key takeaways

Ethereum (ETH) is up 1.3% on Tuesday as co-founder Vitalik Buterin sparked debate over the cryptocurrency’s long-term value proposition.

Bitmine Immersion Technologies acquired another 9,587 ETH, increasing its holdings to 6.07 million tokens, representing approximately 4.97% of Ethereum’s circulating supply.

ETH risks extending its decline toward $1,971 if the $2,101 support level fails, while resistance remains at $2,204 and $2,250.

Ethereum (ETH) has slightly recovered on Tuesday following renewed selling pressure on Monday.

The performance comes as investors weighed a debate over the cryptocurrency’s long-term value proposition following comments from co-founder Vitalik Buterin.

Vitalik Buterin questions Ethereum’s fee-burning investment narrative

Buterin argued that Ethereum’s investment appeal should rest primarily on its ability to function as a secure, decentralized store of value rather than the amount of ETH removed from circulation through transaction fee burning.

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 ETH function in ways that are very hard to make compatible with decentralization and capture resistance.

3. Meanwhile, optimizing for ETH as SoV is aligned with Ethereum focusing on its unique strengths (decentralization and CROPS)

EIP-1559 (including its burn) is fine and good, we should keep them. But we should not feel sad if fee burn is < 10% of breakeven indefinitely; the value of ETH comes from elsewhere.

The core idea: the big thing that people appreciate about Ethereum is decentralization and CROPS. The main pragmatic benefit that these things translate into is stability. SoV is the category where that is not an unneeded extra we merely put effort into for ideological reasons, but rather a pragmatic strength from the perspective of people putting in their assets. And in the era of AI disruption, stability will be highly valued.

— vitalik.eth (@VitalikButerin) November 8, 2026

Ethereum’s fee-burning mechanism has played an important role in shaping the cryptocurrency’s investment narrative since the introduction of EIP-1559 in August 2021.

The upgrade introduced a system that permanently removes the base transaction fee from circulation, reducing the amount of ETH available in the market.

During periods of elevated network activity, transaction fee burning can exceed new token issuance, temporarily making Ethereum’s supply deflationary.

However, Buterin challenged the strength of this argument in a Sunday post on X, suggesting that investors have placed too much emphasis on fee burning as a measure of Ethereum’s economic value.

He explained that much of Ethereum’s historical transaction fee revenue originated from cryptocurrency-related activities, making it closely tied to the broader digital asset market.

Buterin further warned that prioritizing higher fee revenue could create incentives for increased transaction costs, greater protocol spending, and more interventionist governance.

Such developments could undermine the decentralization and neutrality that distinguish Ethereum from traditional financial infrastructure.

Buterin proposed that Ethereum’s long-term value should be anchored in its fundamental properties, particularly as artificial intelligence development accelerates.

He highlighted a framework known as CROPS, representing censorship and capture resistance, open source, privacy, and security.

According to Buterin, these characteristics could become increasingly important in a world where AI systems play a greater role in financial transactions and digital infrastructure.

Bitmine Ethereum holdings reach 6.07 million ETH

Bitmine Immersion Technologies announced on Monday that it acquired an additional 9,587 ETH over the previous week, increasing its total holdings to approximately 6.07 million tokens.

The company’s Ethereum treasury now represents roughly 4.97% of the cryptocurrency’s estimated circulating supply of 122.2 million ETH.

The latest purchase brings Bitmine closer to its stated objective of accumulating 5% of Ethereum’s total circulating supply.

Beyond its substantial holdings, the company reported maintaining approximately 5.227 million ETH in staking positions through its Made in America Validator Network (MAVAN).

Ethereum price forecast: ETH bears target $1,971 support

Ethereum’s technical outlook remains bearish as the cryptocurrency continues trading below its major Exponential Moving Averages (EMAs).

On the daily chart, ETH remains below its 20-day, 50-day, and 100-day EMAs, which are clustered between approximately $2,291 and $2,371.

The position beneath these moving averages suggests that sellers continue to dominate the broader market structure, with recovery attempts likely to encounter resistance.

Momentum indicators reinforce the negative outlook. The 14-day Relative Strength Index (RSI) hovers near 31, indicating weak buying momentum and suggesting that Ethereum is approaching oversold territory.

Meanwhile, the Stochastic Oscillator stands near 9, reflecting more pronounced oversold conditions.

On the downside, Ethereum faces immediate support around $2,101. A decisive breakdown below this level could accelerate the decline toward $1,971, representing the next significant support zone.

If sellers maintain control and ETH fails to stabilize around $1,971, the cryptocurrency could extend its correction toward $1,827.

Despite the prevailing bearish conditions, Ethereum could attempt a short-term rebound if buyers begin accumulating around current support levels.