The Ethereum Foundation (EF) has announced a revised treasury policy aimed at enhancing its financial sustainability and operational transparency. This update introduces clear limitations on spending, establishes stronger reporting structures, and reaffirms the foundation’s role in long-term ecosystem development.
15% Cap on Operational Spending
The updated policy sets a strict limit of 15% of the total treasury to be allocated annually for operational expenses (opex). The EF also emphasized that a 2.5-year reserve buffer will be maintained at all times, ensuring the foundation can continue functioning during unpredictable market conditions.
This strategy aims to reduce opex over the next five years to a sustainable long-term baseline of 5%, allowing the foundation to prepare for what it believes will be critical years ahead (2025–2026) in Ethereum’s roadmap.
ETH Sales and Fiat Diversification Strategy
To maintain this operational model, the foundation stated that it will continue selling portions of its ETH holdings and will diversify into fiat currency where needed. This move is designed to mitigate risk and maintain funding stability, not for speculative profit.
These ETH sales should not be viewed as a loss of confidence, but rather as part of a rebalancing strategy in response to market changes, new yield opportunities, and operational planning.
The EF noted: “Withdrawals should be understood in this context and not as anti-endorsements.”
Commitment to Transparency and Accountability
As part of its policy overhaul, the EF pledged to publish quarterly financial reports to its board and an annual public report. This marks a continued effort to increase transparency, especially as the foundation has faced scrutiny in recent years over perceived opacity and internal controversies.
As of October 31, 2024, the EF held $970.2 million in treasury assets, a decrease of 39% since its previous public financial disclosure.
Responding to Community Concerns
The new policy comes amid rising calls for greater accountability from the Ethereum community. Past concerns have included conflicts of interest involving researchers, internal compensation issues, and slow technology rollouts.
Recent layoffs in the research department underscore the foundation’s efforts to restructure and refocus during a time of growing competition from other blockchain platforms.
By tightening its financial governance, the EF aims to strengthen its long-term role as Ethereum’s guiding institution, balancing sustainability with innovation.