Ethereum lays out 2024 report after accusations of lack of transparency in treasury management

The Ethereum Foundation (EF) released its 2024 annual report on Friday, aiming to address accusations of lack of transparency. The report, disclosed by Executive Director Aya Miyaguchi, delves into the foundation’s policies, key areas of operation and a detailed breakdown of its $970 million treasury reserves.

The report follows heightened scrutiny over a 35,000 ETH ($94 million) transaction from the foundation’s treasury to the cryptocurrency exchange Kraken on August 9. The on-chain detection raised concerns about the foundation’s financial transparency. In response, Miyaguchi said that the transaction was part of EF’s “treasury management”, clarifying that such movements do not always imply the immediate sale of the cryptocurrency.

Miyaguchi also explained that EF is unable to disclose specific transaction plans due to regulatory issues but emphasized that any future sales would be carefully planned and calculated.
 

The report shows that the Ethereum Foundation holds 81.3% of its $970.2 million in treasury reserves in cryptocurrency assets, with 99.45% of those crypto assets in Ether (ETH).

Ethereum Foundation leads with $240.3 million in direct funding support

The annual report revealed that all organizations involved in the Ethereum project spent $497 million on project funding, with $240.3 million, or 48.3%, provided by the Ethereum Foundation.

Source: Ethereum Foundation

The rest was raised by other actors like MakerDAO (currently trading under Sky), Optimism, Gitcoin, Decentraland, Aragon, Uniswap, Starknet, MetaMask DAO, and Protocol Guilds, highlighting strong inter-organizational cooperation within the Ethereum ecosystem.

Apart from such investments at the project level, more than $22 billion in treasury reserves are held by various foundations, organizations, and DAOs, including Optimism, Uniswap, Mantle, Arbitrum, Gnosis and Ethereum Name Service. The Ethereum Foundation itself retains $970 million in treasury funds.

Source: Ethereum Foundation

The report also explained that treasury assets include both liquid and vested assets, although most treasuries mainly consist of projects’ native tokens. In its latest annual report, the Ethereum Foundation announced it will require members to disclose any 'conflicts of interest' for investments exceeding $500,000, except Ether holdings.

The mandate aims to prevent conflicts of interest by ensuring that individuals with substantial exposure to a particular asset are excluded from processes where decisions about such an asset would be made.