- Ethereum to keep a 2.5-year operating expense reserve.
- Annual spending capped at 15% of treasury assets.
- Long-term goal to reduce spending to 5% annually.
The Ethereum Foundation has taken a big step toward long-term sustainability by introducing a new Ethereum treasury policy. This policy aims to safeguard Ethereum’s financial future with a solid reserve strategy. According to the update, the Foundation will maintain an operating expense buffer that covers 2.5 years. This means Ethereum can continue running smoothly even if there are unexpected downturns in the crypto market.
Additionally, the Foundation has set an annual spending cap of 15% of its total treasury. This cap ensures spending is kept in check and resources are not exhausted too quickly. Over the next five years, the goal is to gradually reduce this cap to just 5% per year—further tightening financial discipline.
Internal Reporting for Accountability
Along with the spending and reserve strategy, the Ethereum Foundation has also implemented a structured internal reporting system. The finance team will now provide quarterly and annual financial updates to both the Board and management. This process boosts transparency and ensures responsible handling of treasury funds.
This new approach helps build trust within the Ethereum community and shows that the Foundation is thinking ahead. By being open about how funds are managed and setting clear limits, Ethereum strengthens its role as a leader in the blockchain space.
Why This Matters for the Community
Crypto projects are often criticized for poor financial planning or lack of transparency. Ethereum’s new treasury policy addresses both of these issues. With a robust financial plan and regular reporting, the Foundation sets a new standard in the industry.
The community can now feel more confident about Ethereum’s long-term development and the responsible use of funds. In uncertain times, such financial foresight is not just smart—it’s essential.
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