Vitalik Buterin Defends Ethereum Foundation’s Cryptocurrency Sales

Ethereum co-founder Vitalik Buterin has addressed criticism regarding the periodic sales of cryptocurrency from the Ethereum Foundation’s (EF) reserves, which some argue exert pressure on its price.

bro the ETH foundation is paying researchers and devs that are responsible for

(i) ethereum not bleeding 5M ETH/year to proof of work
(ii) your fees being low today
(iii) your txs getting included in < 30s instead of like 1-30 min (eip 1559) show some respect

— vitalik.eth (@VitalikButerin) October 26, 2024

The programmer noted that the organization funds the work of researchers and developers who ensure the network’s infrastructure, development, and security.

“In reality, the better criticism should be why EF always dumps on the market and destroys the ETH chart when they could easily set a limit order to avoid harming investors?” questioned data analyst Bianca Viceroy.

Buterin responded that assets are indeed sold in this manner, and “sending another 35,000 ETH to Kraken” does not imply an immediate dump.

Puffer Finance advisor Jason Chen inquired why EF does not adopt a model of covering expenses through income from staking reserves.

One internal reason why has been that we don’t want to be in the situation of being forced to make an “official choice” in the event of a contentious hard fork.

One interesting idea around this that is being considered is giving some grants in the form of “you can stake our ETH,…

— vitalik.eth (@VitalikButerin) October 27, 2024

“Why do you insist on regularly selling ETH without considering market sentiment and everyone’s voice? You have always claimed that PoS Ethereum is extremely secure, why not stake ETH yourself? Are you lacking confidence in the mechanism?” he wrote.

Buterin cited the main reason for EF’s rejection of such a scheme as the desire to maintain neutrality in the event of a “contentious hard fork.” However, the organization is considering the possibility of providing grants in cryptocurrency, which recipients could lock up and retain income from, he added.

As another way to address this issue, the programmer mentioned “spreading legitimacy and resources” across multiple entities that would “credibly represent Ethereum.”

Regarding accusations of personal cryptocurrency sales, Buterin emphasized that his ETH reserves have “even increased” over the past month.

As reported by researcher Justin Drake, EF has funds for approximately 10 years of operation, based on the current Ethereum exchange rate.