Culper Research: Why We Are Firmly Shorting ETH?
Culper Research, a Wall Street short-selling firm, presents a case for shorting Ethereum (ETH) and related securities. Their report argues that the Fusaka upgrade in December 2025 severely damaged Ethereum's tokenomics by increasing the gas limit, which caused a 90% collapse in transaction fees—far worse than the 10-30% drop predicted. This created a surplus of cheap block space, enabling a massive increase in "address poisoning" or "wallet dusting" attacks. The analysis claims that 95% of new wallet growth and over 50% of the increased transaction volume are inorganic, stemming from these spam attacks rather than genuine adoption.
The report further states that Vitalik Buterin is aware of these issues and has been selling significant amounts of ETH. It also criticizes prominent bull Tom Lee for using flawed on-chain activity data as evidence of strength. Additionally, lower validator earnings are reducing staking incentives, and Ethereum is losing developer mindshare and market share to competitors like Solana, which is attracting major institutional partnerships. Culper concludes that Ethereum's economic model is broken and its value will continue to decline.
marsbit03/09 00:06
