A pseudonymous analyst has started a new narrative around Ethereum’s upcoming Fusaka upgrade, claiming that it could be the most favorable event ever for ETH as an asset by finally turning Layer 2 networks into meaningful ETH burners.
On The heart of the thesis is a single change: EIP-7918.
“In terms of price, the Ethereum Fusaka upgrade on December 3 will be the most bullish upgrade ever for the eth asset, why? One reason. ‘EIP 7918’,” Kira wrote, calling it “the next big catalyst for the eth burn.”
Ethereum L2 will burn ETH
Kira’s argument relies on how Ethereum currently treats L2s. Since the rollup-centric roadmap took shape, Ethereum’s base layer has effectively subsidized the availability of L2 data. According to him, “for a long time, L1 ETH charged no base fees to L2s, while L2 deployers made millions in profits. So L2s did not burn significant Eth.” This subsidized regime fueled explosive growth of L2, but also limited the amount of L2 usage translating into ETH consumption.
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EIP-7918 is designed to change this by tying L2 data costs more closely to mainnet gas prices. Kira summarizes it as follows: “L2 fees will be limited by the execution cost, which will help us achieve L2 fee price discovery faster. This also helps keep fees down during peaks so that L2 users aren’t subject to absurd transmission fees. Win-win.” In practice, this means that rollups will face a non-trivial, protocol-enforced minimum on what they pay to Ethereum for posting their batches.
It is crucial for ETH holders that these fees are paid in ETH and a portion is burned under the EIP-1559 mechanism. Kira claims that as L2 throughput increases, this will become a dominant driver of ETH burn dynamics: “They will simply pay their fair share to Ethereum L1 and burn significant Eth. It will be slow and steady at first. This will eventually burn millions of dollars of Eth in the long term and L2s will be the main driver in making Eth deflationary.”
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The narrative becomes more aggressive when Kira extrapolates to corporate and institutional consolidations. It lists a series of existing and planned L2s and claims that “Coinbase’s L2 will burn eth, Robinhood’s L2 will burn eth, OpenAI’s Worlchain will burn eth, Sony’s Soneium will burn eth, Alibaba’s Jovay will burn eth, UAE’s ADI chain will burn eth, Kraken’s ink will burn eth, Lighter will burn eth, Deutsche Bank’s Memento chain will burn eth, Arbitrum will burn. eth, etc., etc. Companies will start burning eth.
From there, he extends the thesis to a broader and very optimistic view: “Every company in the world will launch their own Layer 2. Every alt-L1 will become L2 and start burning Eth. Eth inflation will decrease.” While these universal claims go well beyond what the upgrade itself guarantees, they capture the heart of the bullish narrative: if enough economic activity migrates to Ethereum-secured L2s that must pay non-negligible base fees, Ethereum becomes the settlement and value capture layer beneath corporate and institutional chains.
Kira explicitly compares Fusaka to the London hard fork that introduced EIP-1559 in 2021. “When Ethereum introduced burn via eip-1559 in 2021, it sent the entire market higher,” he wrote. “This time too, everyone will be caught off guard. L2s burn incoming eth. Bullish eth. Bullish L2s.” For now, Kira is clear on his own conclusion: “December 3, tik-tok. The ticker is ETH.”
At press time, ETH was trading at $3,022.
Featured image created with DALL.E, chart from TradingView.com
