- Buterin addressed the Ethereum Foundation’s spending amid the market downturn and ETH’s drop.
- Critics questioned EF’s financial transparency and spending categories like “new institutions.”
As Ethereum [ETH] struggles to approach the $3,000 mark, Vitalik Buterin, Ethereum’s co-founder, addressed concerns on social media about the Ethereum Foundation (EF)’s spending practices.
This clarification comes amid a broader market downturn, with ETH experiencing a notable 8% drop in the past 24 hours, outpacing declines seen in Bitcoin [BTC] and Solana [SOL].
Amid growing debate over the EF’s resource allocation, the foundation previewed its 2022-2023 financial report in an X (formerly Twitter) thread and offered insights into its internal and external expenditures.
Source: Josh Stark/X
Details of Ethereum Foundation’s spending
The post here indicated that the spending breakdown of the Ethereum Foundation (EF) was divided into internal and external categories.
The internal spend, which was at 38%, referred to the portion of the budget allocated to the EF’s own researchers and development teams.
Additionally, external spending, which was at 62%, covered grants and payments made to external teams and partners working on ETH-related projects.
Hence, in both years referenced, the spending was approximately 38% on internal resources and 62% on external initiatives.
This meant that the EF invested a larger share of its budget in external projects compared to its own internal operations.
Providing further details, the thread noted,
“The biggest new category in the charts I shared above is “New Institutions”.”
This category reflected the EF’s efforts to foster and support emerging organizations, which can contribute to and enhance the Ethereum ecosystem over time.
Source: Josh Stark/X
Buterin’s joins the thread
In response, Buterin joined the discussion and emphasized,
“The “new institutions” category basically means @NomicFoundation, @TheDRC_ , @l2beat, @0xPARC etc – no World Economic Forum insect protein research here!”
For context, it’s the ambiguity surrounding spending categories like “new institutions” that had sparked skepticism about the Ethereum Foundation’s financial transparency and alignment with its mission of decentralization and innovation.
Critics argued that the EF’s financial reports lacked clarity and detail, raising concerns about the efficiency and effectiveness of fund allocation for the ETH ecosystem.
Community seems unsatisfied
However, despite efforts to provide transparency and clarify the situation, community concerns persist as highlighted by X user Evanss6,
“I don’t think many people actually care about EF’s spend (it’s mostly concern trolling).I think people just want consistent transparency around funds transfers/sales so ones that are erroneously attributed to EF can be denied.”
Adding to the discussion, another X user took a sarcastic tone toward Buterin, and asserted,
Source: Dark Crypto Larp/X
With the upcoming financial report yet to be released, the impact on the ongoing debate around decentralization and innovation remains uncertain.
However, it undoubtedly promises greater transparency in the Ethereum Foundation’s resource allocation and invites the community to scrutinize how these efforts align with ETH’s mission.
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