Vitalik Buterin’s Ether transfers raise concerns after Ethereum Foundation slammed for spending $88 million
- Vitalik Buterin transferred 800 Ether, worth $2.01 million, early on Friday.
- Ethereum Foundation transferred over $88 million worth of Ether from the treasury to Kraken, raising concerns among traders.
- Ether hovers around $2,500 at the time of writing, down 8% this week.
Ethereum (ETH) founder Vitalik Buterin carried out another ETH transfer on Friday, on-chain data shows, raising concerns among crypto traders hours after the spending practices from the Ethereum Foundation were put into question due to its lack of transparency.
Ethereum struggles to break above the $3,000 level, a key psychological support for traders. ETH slipped under $3,000 on August 4 and since then the altcoin has failed to make a comeback.
Ethereum holders take issue with on-chain transfers by Foundation and Buterin
Vitalik Buterin’s transferred on Friday 800 ETH, worth around $2 million, according to Lookonchain data. This adds to another similar move carried out on August 9, when Buterin sent 3,000 ETH, worth more than $8 million, to another wallet. These transfers have raised some concerns amid the community.
vitalik.eth(@VitalikButerin) transferred 800 $ETH($2.01M) to a multisig wallet again 40 minutes ago.
— Lookonchain (@lookonchain) August 30, 2024
The multisig wallet swapped 190 $ETH for 477K $USDC later.
On Aug 9, #Vitalik also transferred 3,000 $ETH($8.04M) to this multisig wallet.https://t.co/81Vf39bvbL pic.twitter.com/6IlwtcqvPg
Buterin’s latest moves with his holdings comes after on-chain data showed that the Ethereum Foundation (EF) transferred $88 million worth of Ethereum tokens from its treasury to cryptocurrency exchange platform Kraken on August 23. Lookonchain tracked the transfer and published the details in a tweet on X.
Note that #Ethereum Foundation deposited 35,000 $ETH($94.07M) into #Kraken just now!https://t.co/1DMzORJ9Eg pic.twitter.com/91x2ik2kbH
— Lookonchain (@lookonchain) August 23, 2024
ETH holders raised questions on the transparency of the Foundation’s expenditure. Ethereum Foundation’s Executive Director Aya Miyaguchi said that the transfer was a part of “treasury management activities”.
The EF has a budget of approximately $100 million per year for grants and salaries of associated members. When recipients are only able to accept fiat, the Foundation transfers Ether to exchanges to change it for fiat currencies.
The executive assured traders that going forward sales of Ether will be “planned and gradual.”
This is part of our treasury management activities. EF has a budget of ~$100m per year, which is largely made up of grants and salaries, and some of the recipients are only able to accept in fiat. This year, there was a long period of time when we were advised not to do any…
— Aya Miyaguchi (ayamiya.eth) (@AyaMiyagotchi) August 24, 2024
Josh Stark, a key member of the Foundation shared expenditure reports and details of where the organization spent funds internally and externally in a tweet thread on X.
1. First, we’ve been working on a new EF report, covering 2022 and 2023. We’re expecting to publish it before Devcon SEA.
— Josh Stark (@0xstark) August 27, 2024
Here’s a preview of spend information from the upcoming report (exact figures TBD). pic.twitter.com/jicVHOy5r7
Ethereum trades at $2,526 at the time of writing.
Ethereum FAQs
Ethereum is a decentralized open-source blockchain with smart contracts functionality. Serving as the basal network for the Ether (ETH) cryptocurrency, it is the second largest crypto and largest altcoin by market capitalization. The Ethereum network is tailored for scalability, programmability, security, and decentralization, attributes that make it popular among developers.
Ethereum uses decentralized blockchain technology, where developers can build and deploy applications that are independent of the central authority. To make this easier, the network has a programming language in place, which helps users create self-executing smart contracts. A smart contract is basically a code that can be verified and allows inter-user transactions.
Staking is a process where investors grow their portfolios by locking their assets for a specified duration instead of selling them. It is used by most blockchains, especially the ones that employ Proof-of-Stake (PoS) mechanism, with users earning rewards as an incentive for committing their tokens. For most long-term cryptocurrency holders, staking is a strategy to make passive income from your assets, putting them to work in exchange for reward generation.
Ethereum transitioned from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) mechanism in an event christened “The Merge.” The transformation came as the network wanted to achieve more security, cut down on energy consumption by 99.95%, and execute new scaling solutions with a possible threshold of 100,000 transactions per second. With PoS, there are less entry barriers for miners considering the reduced energy demands.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
