Culper Research announces short positions on ETH and related securities, claiming that Fusaka's upgraded token economic model has been damaged

PANews March 6th reported that short-selling firm Culper Research announced it is shorting Ethereum and securities related to ETH, including BMNR. The firm believes that after the Fusaka upgrade in December 2025, the ETH token economic model has been damaged. The upgrade increased the Gas cap from 45 million to 60 million, expecting Gas fees to decrease by 10-30%, but they actually dropped by about 90%. Vitalik and validators’ calculations of L1 demand elasticity are based on outdated models, with errors of 3-9 times.

Culper countered Tom Lee’s bullish views. Lee cited growth in active addresses and transaction volume as evidence of improved fundamentals and institutional adoption for ETH, but Culper’s analysis shows that from January 2025 to February 2026, on-chain data indicates these activities are actually driven by low-value transactions caused by address poisoning and dust attacks. After the Fusaka upgrade, 95% of new wallets were created by dust attack wallets, with poisoning attacks increasing more than threefold, accounting for over 50% of ETH transaction growth, currently making up 22.5% of all ETH transactions. Culper states that Vitalik is aware of this and is selling off, expecting ETH to further decline.