Culper Research announced a short position on ETH and related securities, stating that the token economic model was damaged after the Fusaka upgrade

Culper Research, a short-selling firm, announced a short position on Ethereum and ETH-related securities, including BMNR. The firm believes that the economic model of the ETH token has been damaged after the Fusaka upgrade, which raised the gas limit to 45 million to 60 million. While a decrease in gas fees was expected to be between 10% and 30%, the actual decrease was about 90%. Vitalik and validators' calculations of L1 demand elasticity are based on outdated models, with errors ranging from 3 to 9 times.

Culper refuted Tom Lee's bullish viewpoint. Lee cited the growth of active addresses and transaction volume as evidence of strengthened ETH fundamentals and institutional adoption, but Culper's analysis shows that on-chain data from January 2025 to February 2026 indicates that these activities are actually caused by low-value trading waves triggered by address poisoning and dust attacks. After the Fusaka upgrade, 95% of new wallets were created for dust attack wallets, and the number of poisoning attacks increased more than threefold, accounting for over 50% of ETH transaction growth, currently representing 22.5% of all ETH transactions. Culper claims that Vitalik is well aware of this and is selling off, expecting ETH to decline further.