Ethereum Foundation has announced a sweeping update to its treasury management strategy, reflecting its belief that the next two years will be crucial for the future of the blockchain.
The new policy, published Wednesday, lays out how the organization intends to balance sustainability with ecosystem support as Ethereum enters what it calls a “pivotal” phase.
In its updated framework, the foundation says it will adjust Ether sales and capital deployment based on a fixed operating expense buffer. This means it will sell or invest Ether depending on how much it needs to cover its spending over the next few years, ensuring financial stability.
Treasury allocations will be recalibrated to reflect market conditions and priorities, including a greater focus on decentralized finance and privacy-focused infrastructure.
The announcement follows recent internal changes. Earlier this week, the foundation laid off some members of its research and development team and reorganized its Protocol Research and Development division, now renamed “Protocol,” to better prioritize scaling and usability.
Ethereum Foundation Sets Treasury Buffer to Weather Market Cycles and Fund Key Upgrades
The foundation has set its target operating budget at 15% of total reserves. It also plans to maintain a 2.5-year runway. This formula will determine how much Ether it holds versus how much it converts to fiat.
This adjustment comes as Ethereum prepares for major protocol upgrades. These may include wider Layer 2 adoption and advances in scalability and privacy.
With this approach, the foundation aims to boost support during downturns. It also wants the flexibility to pull back when markets overheat, acting as a counter-cyclical force.
Although ETH remains its core holding, the policy shift signals a move toward more active treasury management.
Fiat Stability to Come From Bonds and Tokenized Assets, Not Just ETH Sale
The organization will continue staking ETH and using wrapped ETH in DeFi protocols. These protocols are audited, battle-tested and align with the foundation’s security standards.
At the same time, it plans to expand its exposure to tokenized real-world assets and investment-grade bonds. This is intended to provide stability across its fiat reserves.
Privacy and decentralization also remain key priorities. The foundation reaffirmed its commitment to its “Defipunk” principles. In essence, it aims to support projects that safeguard user privacy, use transparent open-source code and avoid centralized control.
It also plans to evaluate new protocols and user interfaces against a published framework that prioritizes permissionless access, immutability and reduced reliance on centralized oracles.
Quarterly Reports and Performance Metrics Signal New Era of Treasury Discipline
The move signals a clear shift away from passive treasury management. Until now, the foundation mostly held ETH. However, growing complexity and volatility in the ecosystem have led to a more active approach.
From now on, Ether sales and protocol allocations will follow internal benchmarks. These will be reassessed every quarter.
At the same time, transparency remains a core principle. The foundation has pledged to publish annual reports detailing how assets are distributed across fiat, idle ETH, and deployed ETH.
Internally, board members and senior managers will receive quarterly updates. These will include performance reviews, risk assessments and ecosystem engagement highlights.
In the foundation’s view, a more structured treasury policy is key to Ethereum’s long-term autonomy and mission.
Looking ahead, rising institutional interest and tighter regulation raise the stakes. The next two years may determine whether Ethereum leads as a decentralized platform or gets limited by the very systems it aimed to disrupt.
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