The Ethereum Foundation has released a comprehensive treasury policy aimed at increasing transparency and financial discipline, following growing scrutiny over its ETH sell-offs. According to the new framework, the Foundation will maintain a financial buffer of 2.5 years’ worth of operating expenses, with annual spending capped at 15% of total assets. Over the next five years, this ceiling will gradually be reduced to 5%, reinforcing a commitment to long-term sustainability.
This move comes after Ethereum co-founder Vitalik Buterin defended previous ETH sales, explaining they were necessary to cover operational costs. The policy’s design is structured to balance fiscal responsibility with Ethereum’s evolving developmental needs. Hsiao-Wei Wang of the Foundation underscored the importance of the next 18 months, calling 2025–2026 a “pivotal” period for the network.
Nearly $1 Billion in Reserves, Majority Held in ETH
As of October 31, the Ethereum Foundation held a treasury balance of $970.2 million. This includes $788.7 million in crypto assets—81% of which is in ETH—and $181.5 million in non-crypto holdings. The policy introduces regular internal audits, with the finance team required to submit quarterly and annual reports to ensure accountability.
The Foundation’s current runway covers 2.5 years of expenses, highlighting the urgency for careful financial planning. The new strategy reflects a more calculated approach to expenditure while preparing for significant developments in Ethereum’s roadmap.
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Foundation Turns to DeFi for Strategic Yield
In a bold shift, the Ethereum Foundation is increasingly leaning into decentralized finance (DeFi) to manage and grow its assets. Embracing “Defipunk principles,” the Foundation plans to use immutable, audited, and permissionless protocols that align with Ethereum’s ethos of openness and decentralization.
Earlier this year, the Foundation deployed 45,000 ETH—worth around $120 million at the time—into various DeFi protocols. By May 29, it had also supplied ETH and borrowed $2 million in GHO stablecoins through Aave. These moves signal a clear intent to both support and benefit from the DeFi ecosystem, ensuring treasury assets are not just preserved but strategically optimized for growth.
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