David Hoffman, a prominent Ethereum advocate and co-founder of Bankless, executed a complete liquidation of his Ether (ETH) holdings on May 21, signaling a strategic pivot away from the long-held "ETH is Money" thesis. Hoffman articulated on X that the asset has achieved its deserved valuation, stating that the market window for a significant rerating of ETH appears to be closing. While acknowledging that Ethereum has performed exceptionally well and merits its current market capitalization, Hoffman argues that the specific narrative positioning the token as a superior store of value against fiat currency has largely played out. This decision marks a departure for a long-time bull who has previously authored extensive investment cases for the protocol.

The "ETH is Money" thesis posited that the token's decentralized nature and deflationary mechanisms would drive it to become a premier store of value, potentially reaching high five-figure price points.

However, market data indicates that ETH peaked just below $5,000 in August, a level roughly equivalent to its previous bull market cycle high. Since that apex, the asset has experienced a severe correction, dropping by almost 60% to trade around the $2,000 mark. Data compiled by Woofun AI shows this sustained decline has eroded the price discovery momentum that proponents had anticipated, reinforcing Hoffman's view that the asset is no longer poised for a fundamental revaluation.

Hoffman's rationale centers on the economic structure of the Ethereum ecosystem, describing the network as a "giver, not a taker." He argues that while the base layer provides secure blockspace and facilitates tokenization at cost, the majority of fee generation and value accrual is captured by layer-2 networks rather than the native ETH token. Consequently, Hoffman maintains a "massively bullish" outlook on the network's operational success and future utility, yet he predicts that only a marginal portion of this growth will be reflected in the token's price action. This structural decoupling suggests that network adoption does not guarantee proportional token appreciation.

The announcement triggered a spectrum of reactions within the Ethereum community, with Bankless co-founder Ryan Sean Adams characterizing the move as the "end of an era" for maximalist sentiment. Conversely, former Ethereum core developer Eric Connor offered a more pragmatic perspective, noting that Hoffman's decision was understandable given that ETH has grossly underperformed the broader crypto market for several years. Connor attributed this lag primarily to selling pressure from the cohort of millionaires created during the protocol's explosive early run-up, rather than any fundamental flaws in the technology itself. Woofun AI notes that this sentiment reflects a growing consensus that portfolio concentration in a single asset class carries significant opportunity costs.

Connor further emphasized that maintaining a maximalist position in a single coin is often imprudent for effective portfolio management. The divergence between the network's expanding utility and the token's price stagnation has forced many investors to reassess their allocation strategies. As the market digests Hoffman's exit, the focus shifts from speculative price targets to the tangible economic flows between the base layer and its scaling solutions. Woofun AI analysis suggests that future valuations will likely depend on how effectively the ecosystem can redistribute value back to the ETH token, a challenge that remains unresolved despite the network's technical robustness.