ETH Foundation dumps ETH again, how long can the foundation's funds last? Does Ethereum have a future?  

Author: Tina

Editor: Xiao Lu

The Ethereum Foundation recently dumped ETH again, exacerbating the decline in ETH price. So, how long can the Ethereum Foundation's funds last? What about the future of Ethereum?

1. ETH price performance

In this bull run, BTC has already surpassed its historical high in the previous bull run, but ETH, as the world's second largest cryptocurrency, has not yet surpassed its historical high.

ETH's all-time high price occurred in November 2021, at around $4800, while in this Bull Market, the highest price of ETH appeared in March this year, at only around $4000.

Currently, the price of ETH is around $2400, which has dropped by 40% from its high point in March, which is quite good compared to the 70% drop in other altcoins.

However, as the creator of Smart Contracts and the second largest Cryptocurrency, Ethereum has been subjected to unrealistic market expectations. The significant underperformance of ETH, especially when compared to BTC, is difficult for holders to accept.

In 2024, the Ethereum Foundation dumped ETH at least 6 times. On August 24th, the foundation dumped as many as 35,000 ETH.

In 2024, the Ethereum Foundation dumped ETH at least 6 times. On August 24th, the foundation dumped as many as 35,000 ETH.

From the above several dumping records, it can be seen that after the ETH Foundation sells ETH, ETH basically has experienced a decline, or it can be said that it has sold at a temporary price high point several times. Some people ridicule the ETH Foundation for being good at selling coins.

Committed to supporting the development of Ethereum and related technologies, its activities mainly revolve around providing funding and non-financial support for innovative projects within the Ethereum community.

So, the Ethereum Foundation itself is an organization that keeps spending money, dumping ETH to support the development of the Ethereum ecosystem, which is actually normal. In the future, it will definitely continue to dump ETH, in order to maximize profits, of course, the higher the selling price of ETH, the better.

But for ETH holders, the Foundation's dumping behavior will be interpreted as the project party not being optimistic about ETH, shaking the confidence of holders. The dumping behavior further stimulates the decline of ETH. In the case of ETH's continuous price decline, the Foundation's dumping is undoubtedly adding insult to injury.

Some ETH holders are starting to worry about the foundation's continuous dumping of ETH. How long can the funds continue if the foundation keeps selling ETH? Once the foundation sells all the ETH, what will support the development of the Ethereum ecosystem?

On September 5th, Justin Drake, a core researcher at Ethereum Foundation, replied that the current annual budget of Ethereum Foundation is approximately $100 million. Based on the current price, there is still $650 million worth of ETH in the foundation's wallet. Roughly estimated, the funding reserve of Ethereum Foundation can cover a budget for 10 years.

On July 23, the US Securities and Exchange Commission (SEC) approved applications for nine SpotETH ETFs, marking an important step for digital assets to enter the mainstream US financial market, with a volume of over $1 billion on the first day.

On July 23, the US Securities and Exchange Commission (SEC) approved applications for nine SpotETH ETFs, marking an important step for digital assets to enter the mainstream US financial market, with a volume of over $1 billion on the first day.

After the SEC approved the BTCSpot ETF in the United States, the price of BTC continued to pump for two months, eventually reaching a historical high of $73,000 in mid-March.

Gate sets a new high.

However, despite the approval of the Spot Ethereum ETF being seen as an epic Favourable Information, the price of ETH did not pump as expected, with continuous net outflows of ETH and a sustained decline in price.

Of course, objectively speaking, we can't entirely blame ETH. The entire crypto market has been in a downtrend in recent months, and ETH is also struggling to stabilize.

The poor performance of ETH prices is also related to the lack of strong innovation in the ETH network in this bull market, which has led to market confidence in the future of ETH.

The poor performance of ETH prices is also related to the lack of strong innovation in the ETH network in this bull market, which has led to market confidence in the future of ETH.

In the previous two bull runs, Ethereum undoubtedly played a core role as the leader.

Taking the ICO (Initial Token Issuance) Bull Market as an example, Ethereum has opened up an unprecedented new era where anyone or project party can easily issue cryptocurrencies and create decentralized applications (DApps) on the Ethereum platform. This has greatly promoted the popularization and application of blockchain technology and facilitated the thriving development of the entire cryptocurrency ecosystem.

Reshaping the landscape of the financial industry, Decentralized Finance platforms can provide users with Financial Services that are intermediary-free, highly transparent, and convenient to operate through Smart Contract technology, lowering the threshold of Financial Services, allowing more people to enjoy the convenience of financial technology.

ETH Spot ETF continues to see net outflows, with the Ethereum Foundation dumping, a lack of innovation in the ecosystem, and no clear roadmap for future development, causing market concerns about the future of Ethereum, and the price of ETH has also been unable to rise.

However, in this round of encryption Bull Market, Ethereum lacks industry innovation to compete with ICO and Decentralized Finance, and its future development is also uncertain. As Zhu Su said, the biggest problem of the Ethereum Foundation is the current inability to provide a coherent roadmap and effective leadership for the ecosystem.

As the pioneer of Smart Contracts, Ethereum is also a leader in public chains, but compared to other public chains, the transaction gas fees and transaction confirmation speed on Ethereum do not have an advantage, which has given other public chains the opportunity to rise.

As the pioneer of Smart Contracts, Ethereum is also a leader in public chains, but compared to other public chains, the transaction gas fees and transaction confirmation speed on Ethereum do not have an advantage, which has given other public chains the opportunity to rise.

For example, in the public chain ecosystem, Solana is far superior to Ethereum in terms of transaction confirmation speed and gas costs, leading to many DePIN, AI projects choosing to create on the Solana public chain.

The volume on the mainnet of the Ethereum network has led to a continuous decline in the volume of the Ethereum mainnet, and gas fees often drop below 1Gwei.

ETH Spot ETF continues to see net outflows, with the Ethereum Foundation dumping, a lack of innovation in the ecosystem, and no clear roadmap for future development, causing market concerns about the future of Ethereum, and the price of ETH has also been unable to rise.

In short, there is a lot of pessimism about ETH in the current market. In addition to the problems existing in the Ethereum ecosystem itself, it is also affected by the overall market situation of the crypto market at present. Apart from BTC, most of the altcoins have far exceeded ETH, but the market has given ETH too high expectations.

Furthermore, the Ethereum ecosystem is still worth looking forward to. For example, the Pectra upgrade is the next major milestone for Ethereum, expected to be launched in the first quarter of 2025. It will merge Prague (execution layer) and Electra (consensus layer) updates, and it is very likely that speculation on the Pectra upgrade will begin in the fourth quarter of this year.

P.S This article does not constitute any investment advice.