Culper Research Shorts ETH, Alleges Fusaka Upgrade Damaged Tokenomics and Vitalik Buterin Is Selling

Wall Street short seller Culper Research disclosed short positions in ETH and ETH-related stocks including Bitmine (BMNR), alleging Ethereum's tokenomics suffered damage following the December 2025 Fusaka upgrade and that Vitalik Buterin is selling ETH, according to its report. The firm cited onchain data from January 2025 to February 2026, claiming 95% of new wallet growth came from dust addresses, poisoning attacks more than tripled, and poison transactions accounted for 22.5% of all transactions and over 50% of transaction growth. Culper argued the Fusaka-driven gas limit increase from 45M to 60M caused gas fees to fall roughly 90%—far beyond the 10%–30% reduction Vitalik and the protocol team anticipated—cutting validator tip income per unit of gas by 40%–50% and weakening staking incentives, while Solana and Ethereum Layer 2 networks gained share. Tom Lee and Bitmine countered that rising addresses and transaction volumes show institutional adoption and that ETH is not in a death spiral, while Vitalik's father Dmitry Buterin publicly dismissed the report's claim that Vitalik "knows and is selling" as attention-seeking rather than research.