Bankless co-founder David Hoffman said he sold his ETH after concluding that the “ETH is money” thesis has largely played out. This marks a notable shift from someone who has been one of Ethereum’s most visible public advocates. Hoffman said he remains “massively bullish” on Ethereum as a network, but no longer sees a clear path for ETH, the asset, to get a structural rerating from here.
“For someone who built a career, community, identity, and business around Ethereum, this choice does not come lightly,” Hoffman wrote. “The ETH is Money thesis didn’t fail… it played out. Ethereum got the ETH price it deserves, and I don’t see ETH being rerated as an asset, higher or lower.”
The argument isn’t that Ethereum has failed. Hoffman’s point is more uncomfortable for ETH holders: Ethereum may keep succeeding as infrastructure, but only a small part of that success will flow to ETH itself. In his view, the network has become one of crypto’s most important open-source systems, but its design choices increasingly favor applications, rollups, and external monetary assets over ETH’s own monetary premium.
Hoffman Says Ethereum’s Monetary Window Is Closing
Hoffman described Ethereum as a massive coordination game, where the “ETH is money” thesis required many layers of the ecosystem to align at once. Ethereum needed decentralized leadership, responsive governance, fast technical execution, coherent L2 incentives, and enough market dominance to make ETH the natural monetary Schelling point of the ecosystem.
That, he argued, was always a narrow path. “Money is a coordination game, and coordination is hard,” Hoffman wrote. “The Ethereum project itself is a stacked set of coordination challenges across multiple layers, and the ‘ETH is money’ thesis required all of them to succeed, and succeed with confidence.”
In Hoffman’s view, Ethereum made the harder architectural choice compared with Bitcoin. Bitcoin stripped its base layer down to boost BTC’s monetary role. Ethereum added programmability and aimed to maximize blockspace utility. That approach created huge surface area for adoption, but also made ETH’s monetary status depend on Ethereum winning across technology, culture, governance, and market structure all at once. Hoffman said Ethereum got “some of the way there,” but not the maximal version of the thesis many ETH bulls once expected.
Fees, L2s, and the Asset-Capture Problem
A key part of Hoffman’s argument is that smart-contract L1 tokens remain tied to activity, fees, and revenue. He pointed to ETH’s dominance in 2021, Solana’s comeback in 2024, NEAR’s 2026 rerating alongside revenue and burn growth, and long-running fee generators like BNB and TRX as examples of the market rewarding chains that keep or grow direct revenue capture.
Ethereum, by contrast, has deliberately moved toward a structure where value leaks outward. Rollups scale execution, applications capture more of the user-facing margin, and Ethereum provides secure settlement at low cost. Hoffman described this as a feature of Ethereum’s ideology and architecture, but a challenge for ETH as an asset.
“At its heart, Ethereum is a giver, not a taker,” he wrote. “It supplies L2s with the world’s most secure blockspace, at cost. It tokenizes the assets of the entire world, at cost.”
That framing sits at the core of his decision. Ethereum may be “noble,” “good,” and “the world’s most successful non-profit,” Hoffman argued, but that doesn’t automatically make ETH a better investment from here. He said the rollup-centric roadmap means L2s can take “97% margins,” while the fat-app thesis leaves more economics with applications rather than the base asset.
Stablecoins and the ‘Strong Crypto’ Problem
Hoffman also argued that Ethereum’s utilityLiquidity may increasingly strengthen other forms of money. He noted that Ethereum hosted $3 billion in stablecoins in 2020, and today that figure is $163 billion—a 54-fold increase. In that sense, the network’s success as settlement infrastructure has helped expand tokenized dollars, but not necessarily ETH’s role as money. He also questioned whether the “strong version” of crypto—DeFi, NFTs, DAOs, and an alternative financial system built for its own sake—ever became a stable enough cultural or economic equilibrium. The moment when ETH most convincingly functioned as internet money, he argued, coincided with the COVID-era surge in online activity, risk appetite, and public fascination with crypto. “ETH excelled as internet money at the exact moment everyone was forced onto the internet,” Hoffman wrote. “The world discovered cryptocurrency for the first time, and for that brief window, it was cool.” The implication is that ETH’s monetary premium may have depended on a broader crypto-native boom that didn’t last. Ethereum kept building, but the public narrative around crypto shifted back toward scams, grifts, and speculation, weakening the social foundation needed for ETH to become a dominant store-of-value asset. Hoffman closed by stressing that he is not bearish on Ethereum itself. His decision, he said, reflects a capital allocation call after the “ETH is money” thesis reached a mature outcome. At press time, ETH traded at $2,080. Featured image created with DALL.E, chart from TradingView.com.
Frequently Asked Questions
Here is a list of FAQs based on the scenario of a Bankless cofounder selling all of his Ethereum written in a natural tone with clear concise answers
BeginnerLevel Questions
1 Wait a cofounder of Bankless sold all his ETH Isnt Bankless all about being bankless and holding crypto
Yes he did It was a big surprise to the community While Bankless promotes a decentralized cryptonative lifestyle the cofounder explained that his personal investment strategy had changed Hes not necessarily against Ethereum he just made a personal financial decision
2 Why would someone so deep in crypto sell everything Did he lose faith in Ethereum
He didnt say he lost faith in Ethereums technology He explained it was about risk management and portfolio allocation After years of being heavily concentrated in one asset he wanted to diversify into other things like real estate or other crypto projects to reduce his personal financial risk
3 Is this a sign that Ethereum is about to crash
Not necessarily One persons trade even a prominent one doesnt predict the market Its more of a signal about his personal financial goals than a signal about Ethereums future price Many other prominent crypto figures still hold large amounts of ETH
4 Does this mean I should sell my Ethereum too
Absolutely not Your financial situation goals and risk tolerance are completely different from his He made a decision based on his own life You should never copy someones trade just because they are famous Do your own research
AdvancedLevel Questions
5 David Hoffman said he sold for risk management What does that actually mean in practice for a highnetworth crypto holder
For someone with a massive net worth tied up in one volatile asset risk management means concentration risk If ETH dropped 90 he would lose almost everything By selling he can lock in gains and move capital into less correlated assets to protect his wealth from a single black swan event Its about preserving capital not maximizing gains
6 Did he sell because of the Ethereum narrative changing
He hinted at