The Ethereum Foundation has begun converting 5,000 ETH to stablecoins using CoW DAO’s time-weighted average price (TWAP) tool, in a move designed to support research, grants, and donation programs. The transaction is valued at around $11 million based on current market rates and forms part of a wider shift in the Foundation’s treasury management strategy set out in June 2025.
Foundation’s policy triggers ETH conversion
Based in Switzerland, the Ethereum Foundation is the non-profit organization supporting the Ethereum ecosystem by funding core research, developer grants, and public goods. The latest sale has attracted attention across the crypto community, as the Foundation is known to be one of the largest individual holders of Ether.
This conversion reflects the Foundation’s efforts to enact its new treasury management policy published in June 2025. Under the policy, annual operating expenses are capped at 15% of total treasury value, and a minimum cash buffer equivalent to 2.5 years of those expenses must be maintained.
Periodic benchmarks determine whether the cash reserve meets the target, and a shortfall prompts a sale of ETH during the next quarter. This approach is intended to provide stability and ensure that core activities have sufficient funding regardless of market fluctuations.
The organization clarified that it is using CoW DAO’s TWAP feature to complete the sale, a mechanism that splits trades over time to minimize market disruption.
The Foundation confirmed via its official X account that the transaction would be executed through CoW Swap’s TWAP feature as part of ongoing work to fund research, grants, and donations.
As markets watched the conversion, ETH traded at $2,212, showing a 6.5% increase in the past 24 hours. Investors did not respond with significant selling pressure, indicating market absorption of the news.
Emphasis on DeFi and strategic spending
Beyond simple asset liquidation, the Foundation’s published treasury document highlights a philosophical move toward deploying capital according to “Defipunk” principles. These guidelines strengthen the focus on open-source, privacy-focused, and permissionless protocols for treasury activity.
The Foundation’s updated on-chain approach now prioritizes solo staking, the use of established decentralized finance (DeFi) lending protocols, and the potential to borrow stablecoins to optimize returns.
Strict criteria are applied to DeFi protocol selection; qualifying projects must offer self-custody, rely exclusively on open-source code, limit administrative control, and reduce oracle dependence. Notably, privacy protections are given special weight, with the Foundation expressing concern for participant safety and fairness within the ecosystem.
Looking ahead, the Foundation outlined a five-year plan to gradually reduce its annual spending from 15% to a target baseline of 5%. While 2025 and 2026 are identified as crucial years for network development, the Foundation expects a leaner operational approach in the longer term as ecosystem needs evolve.
