Ethereum Foundation to Release Financial Report Amid Community Concerns

The Ethereum Foundation, the primary non-profit organization supporting the Ethereum blockchain, is set to release an updated financial report soon. This announcement comes amid growing scrutiny from the community regarding the foundation's spending and financial transparency. The foundation's main wallet currently holds approximately $650 million, down from $1.6 billion in March 2022.

Key Takeaways

• The Ethereum Foundation plans to release a financial report soon, addressing community concerns about its spending.

• The foundation's main wallet holds around $650 million, with an annual expenditure of $100 million.

• The foundation has a financial runway of roughly ten years, depending on the price of ether (ETH).

• Community members have called for increased transparency following unexplained large movements of ether.

Financial Overview

Justin Drake, a prominent researcher at the Ethereum Foundation, revealed during an ask-me-anything (AMA) session on the r/ethereum subreddit that the foundation spends approximately $100 million per year. The foundation's main wallet currently holds around $650 million, providing a financial runway of about ten years, depending on the price of ether (ETH).

Drake also mentioned that the foundation has a fiat buffer to cover a couple of years of runway. ETH sales were temporarily paused for regulatory reasons, but the buffer has been replenished recently.

Community Concerns and Transparency

The Ethereum community has raised concerns about the foundation's spending and financial transparency. The last financial report, released in March 2022, showed a balance of $1.6 billion, including $1.3 billion in ETH. Since then, the funds have significantly decreased due to the burn rate and price decreases.

Community members have called for regular financial reports detailing expenses, upcoming sales, and the allocation of funds. Some have expressed frustration over learning about large ETH sales through third-party notifications rather than direct communication from the foundation.

Recent Financial Movements

In August 2024, the foundation transferred 35,000 ETH (approximately $94 million) to the Kraken exchange, sparking further concerns about transparency. Aya Miyaguchi, the foundation's executive director, explained that the budget is part of the foundation's treasury management, mainly used for grants and salaries, which some recipients can only accept in fiat currency.

Miyaguchi also mentioned that regulatory complications had caused a delay in treasury activities, but planned and gradual sales would occur moving forward.

Future Plans

The Ethereum Foundation aims to address these concerns by releasing a comprehensive financial report soon. The report will provide detailed information on the foundation's spending, financial holdings, and future plans. This move is expected to enhance transparency and rebuild trust within the community.

As the Ethereum Foundation continues to play a crucial role in the development of the Ethereum ecosystem, maintaining transparency and accountability will be essential for its long-term success.

Sources

• Ethereum Foundation's Main Wallet Down to About $650M, Top Official Says, CoinDesk.

• Cryptomonnaies : La Fondation Ethereum détiendrait 650 millions de dollars dans son portefeuille principal - Journal du Coin, Journal Du Coin.

• Ethereum Foundation to release financial report, holds roughly $650 million in main wallet: Justin Drake | The Block, The Block.

• Ethereum Foundation to Unveil Financial Report, $650M in Reserves | Coinspeaker, Coinspeaker.

• La Fondation Ethereum publiera un rapport détaillant ses $100 millions de dépenses par an, Coin Academy.