Vitalik Buterin took to X to address growing criticism over the Ethereum Foundation's influence, dropping a key figure: the foundation holds a mere 0.16% of the total ETH circulating supply. That stands in stark contrast to other major crypto foundations, which typically hold between 10% and 50% of their project's tokens.
A Deliberately Small Treasury
Buterin stressed the foundation is just one participant in Ethereum's distributed structure, not a central authority. "Our decision to operate with a relatively small treasury is deliberate. The main philosophy is to keep the ecosystem free from centralized structures," he wrote. He added the foundation plans to reduce the frequency of ETH sales in the future, reserving holdings for long-term research and development.
Core Priorities: Research, Security, Decentralization
The foundation's focus remains on long-term research, cybersecurity, decentralization, and open-source development. Buterin made clear the organization does not track short-term price movements or react to ETH price swings — a stance that diverges from community expectations for price support.
Lido Withdrawal and Treasury Moves
In May, the foundation withdrew 21,270 ETH previously staked on Lido. The move was not a sale but part of a long-term treasury strategy, even though those assets no longer generate staking rewards. Recent events — including major ETH holders closing positions and several key employees leaving the foundation — have fueled fresh debate within the ecosystem.
Dencun Upgrade: Scalability Over Short-Term Revenue
The Dencun upgrade, activated in March 2024, sharply reduced Layer 2 transaction fees but also cut mainnet revenue. Analysts see this as evidence the foundation prioritizes ecosystem scalability and user experience over near-term tokenomics. The foundation has no interest in competing directly with high-performance blockchains, sticking instead to its core objectives of security and robust infrastructure.
A Philosophy Shared With Open-Source Foundations
The Ethereum Foundation's approach mirrors that of the Linux Foundation and Mozilla Foundation — these groups rarely intervene in commercial ventures built on their platforms or focus on short-term market results. But because ETH functions as both a utility token and a financial asset, the community often expects price support from the foundation. Buterin's latest remarks draw a firm line: the foundation stays out of market operations, occasionally allocating ETH into protocols like Aave and Compound as a savings-driven strategy.