Ethereum Foundation's Main Wallet Down to About $650M, Top Official Says

As a seasoned crypto investor with over a decade of experience in this wild and unpredictable market, I find myself both intrigued and somewhat concerned by the latest revelations about the Ethereum Foundation’s financial status. On one hand, it’s impressive to see such a significant war chest, currently sitting at around $650 million. However, the fact that they’ve already burned through $1 billion in just ten years, with a burn rate of approximately $100 million per year, leaves me wondering how long this runway will last.

According to a leading figure, the Ethereum Foundation – a key non-profit group backing the Ethereum blockchain – plans to unveil a revised financial report in the near future. It’s also worth noting that the foundation’s primary Ethereum wallet is currently containing approximately $650 million.

Justin Drake, a well-known researcher at the Ethereum Foundation (EF), stated during a virtual question-and-answer session on an Ethereum subreddit under the username “bobthesponge1,” that the EF approximately spends $100 million annually and presently has a funding duration of around 10 years, contingent upon the value of ether (ETH), Ethereum’s native token.

Drake confirmed to CoinDesk that bobthesponge1 is his Reddit account.

“The EF has a fiat buffer to cover a couple of years of runway,” he wrote in the AMA session. “ETH sales were temporarily paused for regulatory reasons so the buffer wasn’t replenished until recently.”

Previously, the Ethereum Foundation (EF) disclosed details regarding its cryptographic assets in March 2022, revealing a total balance of approximately $1.6 billion within their treasury. This comprised around $1.3 billion worth of Ether (ETH), and roughly $11 million in various other digital currencies.

At the time, the ETH price was $3,283. It’s down about 30% since then, to $2,296.

Ethereum Foundation's Main Wallet Down to About $650M, Top Official Says

Over the past two years, because of a faster spending pace and declining prices, our funds have seen a substantial reduction.

A Reddit user inquired about whether a contingency plan for sustainability exists, should the EF encounter a situation where its financial resources deplete.

“I’m not aware of any plan to sustainability :),” Drake responded.

The news was first reported by The Block.

2024-09-06 19:47

Ethereum Foundation’s Main Wallet Down to About $650M, Top Official Says

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