Short seller Culper Research is betting against ether (ETH) and ETH-linked stocks, including treasury firm BitMine. Culper argues that Ethereum's recent Fusaka upgrade has impaired the network's tokenomics, leading to a sharp decline in transaction fees and reduced staking yields. This, they claim, could trigger a negative feedback loop, decreasing network security.
The report also notes Ethereum co-founder Vitalik Buterin has sold nearly 20,000 ETH this year. Culper contrasts this with bullish sentiment from figures like Tom Lee, chairman of BitMine, whose firm has accumulated significant ETH holdings, now reportedly 45% underwater.
Culper dismisses rising transaction counts and active addresses cited by bulls, attributing the surge to address poisoning attacks. They estimate Ethereum fees have dropped approximately 90% since the upgrade, suggesting ETH is in a "death spiral."