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Ethereum Foundation announced plans to publish its financial report as soon as possible. This announcement came after community members drew attention to the foundation’s spending patterns.
Ethereum Foundation Listens to Transparency Demands
Ethereum Foundation researcher Justin Drake explained this situation during an “ask me anything” (AMA) event on the r/ethereum subreddit under the pseudonym “bobthesponge1”.
Drake said, “Ethereum Foundation will publish a comprehensive financial report as it did in April 2022.”
The report published in April 2022 stated that the foundation’s assets under management were valued at $1.6 billion as of March 2022. Of this amount, $1.3 billion was held in Ethereum.
Regarding the ongoing discussions around the foundation’s financial expenditures, Drake tried to clarify some issues with “limited personal understanding.” According to Drake, the Ethereum Foundation spends approximately $100 million annually and has around $650 million worth of funds in its main Ethereum wallet. This situation predicts an approximate 10-year validity period based on ETH’s market price.
Drake said, “We plan to spend 15% of the remaining funds annually.” This statement was confirmed by Ethereum co-founder Vitalik Buterin in a separate comment on the subreddit.
Buterin noted that such a budget strategy means the Ethereum Foundation will shrink over time.
Community Reaction and Mysterious ETH Transfers
Some members of the Ethereum community expressed their dissatisfaction with the lack of transparency around financial transactions. This situation has created fear, uncertainty, and doubt about the intentions of the Ethereum Foundation.
Ethereum Foundation Executive Director Aya Miyaguchi said, “The budget is part of the foundation’s treasury management and is primarily used for grants and salaries.”
Miyaguchi also noted that some recipients could only accept fiat currency and that regulatory complexities had caused delays in treasury activities for a while.
However, a user named hyper1on (@0xhyper1on) opposed this situation with a photo showing the transactions made alongside the Kraken transfer.
The post shows six movements of 1,000 ETH between January and August 2024. Another X user questioned why the Ethereum Foundation did not resolve the situation without waiting for community members to express their concerns. They also mentioned their dissatisfaction with learning about the Kraken transfer from a third-party notification.
At the time of writing this news, Ether’s price is trading at $2,367.23, down 1.02% in the last 24 hours.
The Ethereum Foundation’s efforts to increase financial transparency are being closely monitored by the community. The foundation’s explanations regarding budget and spending strategies are considered important steps to regain the trust of community members. The publication of the financial report aims to provide more transparency about Ethereum’s future financial management.
