Ethereum Foundation Announces Financial Policy, Aims to Reduce Operational Expenses to 5% Long-Term Benchmark Over Five Years

Blockbeats
05 Jun

BlockBeats News, June 5th, the Ethereum Foundation released a Financial Policy on its official blog. The mission of the Ethereum Foundation (EF) is to strengthen the Ethereum ecosystem and uphold its long-standing, uncompromising core goal: achieving "applications that run exactly as programmed without any possibility of downtime, censorship, fraud, or third-party interference."

The role of the EF Treasury is to support the Foundation's long-term autonomy, sustainability, and legitimacy. The Ethereum Foundation (EF) expects to continue as a long-term custodian of the ecosystem, but its scope of responsibility will gradually narrow. We plan to roughly linearly reduce annual operational spending over the next five years, ultimately reaching a baseline level of 5% for long-term maintenance.

We will frequently reallocate funds between different protocols based on market changes, diversification needs, or new revenue opportunities. Throughout the year, EF will regularly assess the deviation of fiat-denominated assets in the Treasury from the operational spending buffer target and use this information to decide whether Ethereum needs to be sold in the next three months and the amount to be sold. These Ethereum sales are usually conducted through fiat off-ramps or on-chain exchanges for fiat-denominated assets. Our current strategies include independent staking and providing wETH to mature lending protocols. Core deployments will continue to be evaluated but with an overall focus on long-term holding. EF may also borrow stablecoins and seek higher yields on-chain.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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