Bankless Cofounder Says Ethereum Success May Not Flow Back to ETH Holders

TLDR

• David Hoffman said he sold ETH after holding it for nine years.
• He remains bullish on Ethereum as a network and ecosystem.
• Hoffman said the ETH Money thesis has largely played out.
• He argued apps, stablecoins, and L2s may capture more value.
• Hoffman said Ethereum gives services at cost, not high markup.

Bankless cofounder David Hoffman said he sold his ETH after nine years, while still backing Ethereum’s network. He argued that Ethereum may keep growing through apps, stablecoins, and layer two systems. Yet he said only a smaller part of that growth may return to ETH holders as direct token value over time.

Hoffman Says ETH Thesis Has Changed

Hoffman said the “ETH is Money” thesis has reached much of its market potential. He said Ethereum delivered many things that supporters expected, but the asset may not get another large market rating.

“I expect Ethereum as a network to do exceptionally well from here on out,” Hoffman said. “I think only a marginal amount of that success will be reflected in ETH.”

He said the issue is not weak faith in Ethereum. Instead, he sees a gap between Ethereum’s growth and ETH’s value capture. He said capital may now find better returns elsewhere in crypto markets.

Hoffman described Ethereum as a “giver, not taker.” He said the network provides secure blockspace, tokenization, and DeFi settlement at cost. That design helped Ethereum grow, but it also limited markup for ETH holders.

Apps and Layer Twos Capture More Value

Hoffman said Ethereum’s rollup-focused plan changed where value sits in the ecosystem. Layer two networks can scale, set fees, and build markets, while Ethereum provides base security. He said this helps the ecosystem, but it may reduce direct fee demand on Ethereum’s main layer. 

He also noted that apps may now keep more revenue, while protocols take less. The Bankless cofounder also pointed to stablecoins as a key example. He said stablecoins on Ethereum expanded sharply and helped the dollar gain more reach on-chain.

In his view, that use case supports Ethereum activity, but it does not always strengthen ETH as money. He said Ethereum can help other forms of money, including dollars and Bitcoin, move across its rails.

Ethereum Still Seen as a Strong Network

Hoffman said Ethereum remains one of the most important open-source projects in crypto. He also said it has earned its current market position through years of development. He added that Ethereum chose a harder path than Bitcoin. 

Bitcoin kept its design narrow, while Ethereum added smart contracts, apps, tokens, and layer two systems. That broader plan created more coordination demands. Hoffman said Ethereum needed strong governance, fast research, and aligned layer two teams. 

It also needed market confidence across many parts of its stack. He said the thesis did not fully fail, but it did not reach its strongest version. For that reason, he sold ETH while staying positive on Ethereum’s network, apps, and wider ecosystem.

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