Ethereum Foundation considers staking its billion-dollar ETH holdings amid criticism and leadership reforms

The ethereum Foundation has been criticized for selling eth simply to pay bills instead of exploring staking or DeFi. Now, according to Vitalik Buterin, the foundation is looking at these options, including the possibility of staking approximately $1 billion in eth holdings.

The backlash against the ethereum Foundation has intensified in recent days due to its lack of commitment to the ethereum ecosystem and eth sales.

look chain <a target="_blank" href="https://x.com/lookonchain/status/1881289250018378185″ target=”_blank” rel=”noopener nofollow noreferrer”>reported that the ethereum Foundation dumped another 100 eth on Monday for about $336,000. eth sales, since January 2, 2024, have amounted to $13 million, or 4,666 eth.

DCinvestor, a strong supporter of the ecosystem, said that Trump-backed World Liberty Financial is “more aligned with the success of ethereum-based DeFi than the ethereum Foundation.”

“Trump created a DeFi protocol team, they are using Aave, they use Cowswap to sell the proceeds from their sale in eth. Most of the time, EF pretends that DeFi doesn't exist because they are so afraid of playing favorites that they prefer to focus solely on the “world computer” narrative instead of acknowledging how the chain is being used. <a target="_blank" href="https://x.com/iamDCinvestor/status/1881131783409787083″ target=”_blank” rel=”noopener nofollow noreferrer”>saying DC inverter.

“To be completely neutral, we literally cannot use the chain that we are here to defend and protect,” he criticized the foundation in a separate statement. <a target="_blank" href="https://x.com/iamDCinvestor/status/1881135784365101071″ target=”_blank” rel=”noopener nofollow noreferrer”>mail.

In response to DCinvestor, Josh Stark, a contributor to the ethereum Foundation, stated that the foundation actively uses the ethereum blockchain in its daily operations.

The EF actively participates with the ethereum ecosystem by exchanging eth for stablecoins for operational purposes, making payments to beneficiaries and team members in eth and stablecoins, using the mainnet and layer 2 networks, as well as payments in chain and digital IDs for their events, Stark explained.

Stark's comment sparked even more criticism, especially in light of recent eth sales.

Eric Conner, OG of ethereum and CryptoPunks, stated that the primary use of EF is to “get rid of eth.” he too <a target="_blank" href="https://x.com/econoar/status/1881158441496150187″ target=”_blank” rel=”noopener nofollow noreferrer”>disputed why the foundation only sells eth instead of exploring staking or DeFi to manage its finances.

Buterin, responding to Conner, explained that betting historically faced intense regulatory challenges. However, he noted that these concerns have diminished.

While regulatory uncertainties have eased, the challenge of maintaining neutrality during controversial hard forks remains a key focus for the foundation, according to Buterin. If the EF bets, it would automatically associate itself with one side of a hard fork, compromising its neutrality.

“Historically, the concerns were (1) regulatory, (2) if EF takes a risk, this de facto forces us to take a position on any future controversial hard forks,” Buterin explained. “(1) is less than before, (2) remains.”

“There are definitely ways to minimize (2), and we've been exploring those recently,” he said. <a target="_blank" href="https://x.com/VitalikButerin/status/1881298926650929415″ target=”_blank” rel=”noopener nofollow noreferrer”>saying.

Responding to the suggestion to run both forks or stop betting before a fork, Buterin <a target="_blank" href="https://x.com/VitalikButerin/status/1881313931396055505″ target=”_blank” rel=”noopener nofollow noreferrer”>saying are not viable solutions due to the drawdown mechanism and limited withdrawal rate on the ethereum network.

However, community members believe there are still better approaches than simply selling eth to fund operations.

“We think the key point is that OTC trading should be considered rather than on-chain dumps,” Spot on Chain stated. “No one wants to see EF continually dumping eth on them.”

“In all seriousness, there are workarounds and constantly selling eth is not the best strategy,” said one x user.

Leadership restructuring

The ethereum Foundation is undergoing a leadership restructuring to improve technical expertise and communication with ecosystem participants.

As shared by Buterin, this initiative aims to increase execution speed, support application developers, and commit to privacy, open source development, and resist censorship at application layers.

The restructuring focuses on expanding the use of decentralized and privacy technology for payments and treasury management, while maintaining ethereum's global neutrality and avoiding becoming a lobbying organization.