Ethereum Valuation Debate Intensifies: Experts Advocate for Utility Over Gas Revenue

William Mougayar, a prominent Ethereum advocate and founder of the Ethereum Market Research Center (EMRC), recently challenged conventional valuation metrics for the Ethereum blockchain, asserting that focusing solely on gas revenue is a flawed approach. In a statement made on social media, Mougayar drew a parallel, stating, > "It is no more reasonable to value Ethereum based on gas revenue than it is to value TCP/IP based on packet fees." This perspective underscores a growing sentiment among industry experts to assess Ethereum's value through its fundamental utility and network effects rather than transactional fees alone.

Mougayar's analogy highlights that foundational internet protocols like TCP/IP are not valued by the fees generated from data packets, but rather by their indispensable role as underlying infrastructure. Similarly, he argues that Ethereum, as a decentralized global settlement layer and programmable smart contract platform, derives its true value from its extensive ecosystem, security, and the wide array of applications it enables. This viewpoint is consistent with his long-standing position against valuing cryptocurrencies purely on speculative price movements.

Leading financial institutions and crypto research firms echo this advanced valuation approach. Reports from Grayscale and VanEck identify Ethereum as a "triple-point asset," functioning as money, a consumable commodity, and an interest-bearing asset. These analyses emphasize metrics such as network effects, total value locked (TVL) in decentralized finance (DeFi), and staking yields as more robust indicators of value than simple gas fee revenue. The implementation of EIP-1559, which introduced token burning, further transforms Ether into a deflationary asset, aligning its supply dynamics with network demand.

The Ethereum Market Research Center, curated by Mougayar, aims to bridge the understanding gap for institutional and professional audiences by providing in-depth analysis of Ethereum's ecosystem. This initiative seeks to move the narrative beyond superficial price speculation to a comprehensive understanding of Ethereum's role in the evolving digital economy, including its "Security as a Service" model where ETH's value secures various protocols and applications. This broader perspective suggests that Ethereum's enduring value lies in its foundational utility and its capacity to foster innovation across numerous sectors.