The Ethereum Foundation (EF) released its annual financial report earlier today, revealing significant stakes and a commitment to transparency and long-term sustainability.
Ethereum Foundation Holdings
As of October 31, 2024, EF revealed that its treasury held approximately $970.2 million, including $788.7 million in crypto assets and $181.5 million allocated to non-crypto investments and assets.
Notably, nearly 99.45% of EF’s crypto holdings are in Ethereum (ETH), representing 0.26% of the total circulating ETH supply.
In its report, the FE emphasizes a conservative cash management policy designed to withstand market volatility and ensure the availability of resources in the event of a prolonged market downturn. They noted in the report:
We choose to hold the majority of our treasury in ETH. FE believes in the potential of Ethereum and our ETH holdings represent this long-term outlook.
To support this approach, the FE “periodically” sells a portion of its ETH holdings, thereby building fiat reserves during bullish market conditions to fund spending needs during bearish phases.
1/ Introducing the Ethereum Foundation Report, 2024 Edition. Learn more about EF, our recent work, the Ethereum backer ecosystem, new organizations and policies. The full report is here: pic.twitter.com/uhbzsngaWD
– Aya Miyaguchi (ayamiya.eth) (@AyaMiyagotchi) November 8, 2024
It should be noted that the FE’s transparency on this ground comes against the backdrop of past scrutiny and community feedback regarding large transactions and sales of ETH by the foundation without notice, which led to to calls for clearer communication.
Strengthening rules on conflicts of interest for staff members
The Ethereum Foundation has also introduced enhanced measures to address potential conflicts of interest among its team members. Under the updated policy, EF staff members, called “EFers,” can engage in external work but must disclose their involvement and seek approval from their team leaders.
For engagements with a total value greater than $25,000 per year, review by an internal focus group is mandatory. The policy specifically prohibits EF staff from accepting compensation for illiquid assets with uncertain market value, such as advisory token packages for pre-launch projects, unless a rare exception is granted .
The report also highlights that the primary mission of the FE is to finance and support public goods for the Ethereum network. Spending in 2023 included $47.4 million for “new institutions” aimed at boosting the ecosystem, a significant increase from 2022’s $28.6 million.
Additionally, the FE invested $34.7 million in Layer 1 research and development, up from $32.1 million the previous year. Aya Miyaguchi, executive director of the Ethereum Foundation, highlighted the foundation’s long-term approach, saying:
EF’s long-term thinking allows us to focus on supporting a sustainable and open ecosystem. We are more determined than ever to plant seeds that may not mature until years later, ensuring Ethereum’s resilience and collaborative growth.
Featured image created with DALL-E, chart from TradingView
