Ethereum co-founder Vitalik Buterin is arguing that ETH should be promoted primarily as a store of value (SoV), rather than as an asset whose value depends on fee burning. The debate is therefore about which features should underpin Ethereum’s long-term value proposition: monetary mechanics tied to network fees, or the network’s resilience and resistance to censorship and control.

In a thread, Buterin said the idea of “ETH as fee-burning token never was as strong as it seemed.” He argued that optimizing Ethereum around fee burning could weaken its “decentralization and capture resistance.” Instead, he said ETH’s value should be tied to the stability provided by Ethereum’s focus on “decentralization and CROPS” — censorship and capture resistance, open source, privacy and security — which he expects to become more highly valued in an “era of AI disruption.”

Ethereum’s 2021 EIP-1559 upgrade introduced fee burning and temporarily placed the network into a deflationary phase when fee revenue was high. Supporters, including the Bankless podcasters, subsequently promoted Ethereum as “ultrasound money.” However, fees and revenue have continued to fall, weakening that narrative. Median transaction fees declined from 35 cents to 3.5 cents between January and October this year, even as daily transaction volume rose by more than half.

Some Bitcoiners, who regard BTC’s store-of-value status as fundamental, criticized Buterin’s comments. Dan Held, founder of Held Media, described them as “ETH trying to pivot to Bitcoin’s SoV narrative after all of its previous narratives collapsed. Again.” He added that it was “wild that you think a protocol with a constantly changing monetary policy (just like fiat) can be a ‘sound money.’”

Ethereum proponents counter that the network has not changed its monetary policy since The Merge in 2022, and that each change has reduced rather than increased issuance. Ethereum supporters welcomed Buterin’s effort to establish a clearer narrative for the protocol. MetaLeX attorney Gabriel Shapiro called it a “nature is healing moment” and said, “I think on fundamentals ETH can be a much better SoV than both ZEC and BTC.”

Solana co-founder Anatoly Yakovenko also said Buterin was “absolutely right that you can’t focus on fees as the product,” although he included a subtle criticism of Ethereum’s “product.” The source of Yakovenko’s comments was his post on X.

Election result creates uncertainty for crypto regulation

Crypto-focused super PACs spent $176 million across 100 races, including $64 million in an unsuccessful effort to prevent Sherrod Brown from retaining his Senate seat. Their influence initially appeared limited after the election. However, a Fairshake spokesperson told Crypto In America that the PAC spent $154.5 million across 93 races and supported the winning candidate in all but seven, representing a 92% success rate.

Stand With Crypto said a majority of lawmakers in both chambers are now considered pro-crypto. The group classified 50 of 100 senators as “pro-crypto” and 33 as “anti-crypto,” while 241 members of Congress support the industry and 106 are described as actively opposed to it.

At the same time, prominent crypto critics could take influential positions. Brown is likely to join the Senate Agriculture Committee, while Elizabeth Warren is expected to become chair of the Senate Banking Committee. Those committee roles could shape how lawmakers approach both market-structure legislation and oversight of crypto-related financial products.

“The next Congress will bring a fundamentally different environment for crypto in Washington, and the industry should expect significantly more scrutiny,” said Kyle Bligen, executive director at the Decentralization Research Center. Democrats are reportedly considering expanding proposals from Representative Maxine Waters into a broader market-structure bill. The CLARITY Act could still be revived, but potentially only with stronger ethics provisions addressing allegations involving President Donald Trump.

“A sitting president’s family launching memecoins and a stablecoin is a real governance problem,” Fidelity Digital founder Hadley Stern told Magazine. “If I’d done that at Fidelity, I’d have been walked out the same afternoon.”

The TRUMP memecoin lost one-third of its value during the week, making it the biggest decliner among the top 100 cryptocurrencies. AI-related stocks also fell sharply after the election, while Bitcoin dropped below $76,000 and remained there.

Social engineering preceded Binance’s $6.34 billion hack

Binance said North Korean hackers began compromising its systems in June, when an employee downloaded a tampered Homebrew installation while trying to install an AI coding tool. Although Binance detected that incident quickly, the attackers had already obtained information about employees working on the exchange’s wallet infrastructure.

In September, attackers posing as recruiters targeted another software engineer and persuaded the employee to download a malicious file presented as a coding assignment. On Oct. 20, they used the compromised computer and an internal AI tool to access the systems of two additional engineers and deploy malware.

The sequence described by Binance shows that the compromise extended beyond a single technical vulnerability: attackers used employee targeting, malicious downloads and access to internal tools before reaching the wallet-signing service. The attackers eventually reached Binance’s internal wallet-signing service, enabling them to steal billions of dollars. “This wasn’t one mistake or one breach — it was a months-long campaign,” Binance co-CEO Richard Teng said in a Tuesday post on X.

Ethereum researcher brings quantum-resistance target forward

Ethereum Foundation researcher Justin Drake is targeting December 2028 for completion of Ethereum’s post-quantum and post-AI transition. That is one year earlier than the foundation’s previously announced deadline for quantum resistance.

Speaking at Devcon 8 in Mumbai on Tuesday, Drake outlined the accelerated schedule. “Our hope is that by December 2028 we’ll be able to wrap up the full post-quantum and post-AI transition,” he said, adding that developers have 24 months to deliver three more network upgrades. The Ethereum Foundation’s September roadmap had set December 2029 as the deadline for quantum resistance.

The roadmap is currently on hold. Core developers have delayed the Glamsterdam upgrade indefinitely while they address security concerns related to eight smart contract invariants. The foundation’s protocol priorities were outlined in its September roadmap.

THORChain resumes swaps despite FBI warning

Permissionless decentralized exchange protocol THORChain restored trading on most networks on November 4 despite an explicit FBI warning not to process funds linked to the Binance hack. RUNE rose 15% in 24 hours after Bitcoin, Ethereum, Bitcoin Cash, Dogecoin, Litecoin, Tron and Zcash were re-enabled. Avalanche, Base and XRP were already operating.

Chainalysis reported that THORChain had processed more than $46 million from the hack during the first 72 hours after Binance was attacked. Validators earned approximately $200,000 in fees, according to The Wall Street Journal. More funds would likely have passed through the platform, but cross-chain swaps were automatically halted because of an unrelated Ethereum block reorganization.

THORChain co-founder JPThor said the FBI warning’s inability to stop the protocol demonstrated that it was decentralized.

“The fact that the FBI did in fact call out the protocol —— and nobody could do anything —— means in fact the protocol is decentralised. Nobody in their right mind in a western country would flagrantly ignore a direction like that.”

Weekly winners and losers

At the end of the week, Bitcoin (BTC) was down 4.5% at $74,302, Ethereum (ETH) was down 6.3% at $2,117, and XRP (XRP) was down 5% at $1.11. The total cryptocurrency market capitalization stood at $2.49 trillion, according to CoinMarketCap.

Among the 100 largest cryptocurrencies, the three biggest altcoin gainers were Pieverse (PIEVERSE), up 39.2%; Injective (INJ), up 11.1%; and Tether Gold (XAUt), up 4.2%.

The three biggest altcoin decliners were OFFICIAL TRUMP, down 32.8%; Worldcoin (WLD), down 20.8%; and Ethena (ENA), down 19%.

Top prediction of the week

Binance hack may be a “temporary setback” for crypto, Grayscale says

Grayscale said Binance’s $6.3 billion hack could temporarily damage confidence in crypto markets but ultimately encourage stronger security practices across exchanges.

“It also underscores the importance of institutional custody, such as offered by US-based crypto [exchange-traded products],” Grayscale head of research Zach Pandl said in a Tuesday report. “These vehicles hold their assets at state-chartered banks and qualified custodians, typically offering offline storage, multi-signature wallets, SOC attestations and insurance policies,” he added. Grayscale discussed the incident in a report.

Top FUD of the week

Binance France to close user accounts on Dec. 31

Binance France is closing its operations in the country. Emails sent by Binance to users said all accounts would be closed on Dec. 31, while assets remaining on the exchange would incur monthly fees beginning Nov. 29.

Accounts that still hold a balance on that date will be charged a monthly maintenance fee equal to 0.025% of the balance, with a minimum charge of 10 USDC, a stablecoin designed to track the US dollar.

Cointelegraph reported in late June that Binance had told European Union users that access to key services would be restricted after the exchange failed to secure Markets in Crypto-Assets (MiCA) regulatory authorization from a member state before the July 1 deadline. The restrictions were covered in Cointelegraph’s report.

Suspicious prediction-market activity preceded election poll release, NYT reports

Suspicious bets were placed on prediction markets shortly before two New York Times/Siena political polls were made public, according to reports.

Vanderbilt University researchers said a Polymarket user wagered nearly $200,000 on Oct. 31 that Nebraska Senator Pete Ricketts would be re-elected. One hour later, a Times/Siena poll was released showing Ricketts in the lead.

A Friday report by The New York Times said it was unclear whether the user had access to inside information, but the bettor won more than $77,000. The user also placed similarly large bets on other markets, including Kalshi. The reports were published by The New York Times and in a follow-up article.

Gnosis Pay breach exposes personal and card information

Crypto-linked Visa debit-card provider Gnosis Pay disclosed a security breach on Friday that exposed customers’ payment-card details, home addresses and cryptocurrency wallet addresses.

Gnosis Pay said it detected unauthorized access to its legacy consumer-card system on Nov. 3 and began containing the breach within two hours. The company said customer funds and its separate enterprise platform, which supports white-label card programs, were unaffected. Gnosis Pay described the incident in a company blog post.

Top Magazine features of the week

• What Democrats’ US midterm sweep means for the CLARITY Act: The CLARITY Act faces a new test as Democrats control Congress, raising questions about consumer protections, ethics and what the crypto industry may have to concede.
• Bitcoin holders have received eCash — What can you do with it?: Bitcoin’s eCash fork gives eligible holders an equivalent balance of ECX, but questions remain about where the tokens can be traded and what they can be used for.
• How Aussie Bitcoiners can avoid 2027’s shock CGT hike: The article examines strategies Australian Bitcoiners could use to address the country’s 2027 capital-gains-tax increase, including setting up a self-managed super fund (SMSF), forming a company or leaving the country.
• Can decentralized phone networks power the AI revolution?: Decentralized AI networks aim to use everyday phones as an alternative to centralized computing infrastructure, although skeptics remain unconvinced.

Source: Cointelegraph