The Ethereum Foundation (EF) announced on April 8th that it will convert 5,000 ETH into a stablecoin through CoWSwap’s TWAP feature to fund research, grants, and donations.
This announcement reignited the debate over the purpose of the Foundation’s financial overhaul. Last year, EF moved its financial assets to DeFi, borrowed using ETH as collateral, and then began a staking initiative centered on around 70,000 ETH.
The reality outlined in the EF’s June 2025 financial policy suggests a different model. It tied monetization to a fiat-denominated operational buffer, keeping ETH sales, staking, and stablecoin borrowing within the same Treasury framework.
On February 13, 2025, the EF Treasury announced that it had deployed 45,000 ETH across Spark, Aave Prime, Aave Core, and Compound. On May 29, the company borrowed $2 million in GHO for its Aave position.
This move had symbolic weight as it showed that EF was using DeFi rails to raise working capital without selling spot ETH.
By early April, that interpretation had permeated the retail conversation, with a Reddit post claiming that EF was “no longer selling.” One commenter replied, “I’m glad they stopped selling it.”
Despite the anecdotal evidence, this kind of chatter shows how a stronger version of the paper was already in circulation before EF announced its April 8 switch.
Sales are ongoing
EF launched its staking initiative on February 24th, announcing that it would stake 70,000 ETH and the rewards would be returned to the Treasury.
On March 14th, we completed a 5,000 ETH OTC sale to BitMine at an average price of $2,042.96. On April 3rd, on-chain activity brought the total amount of staking to approximately 69,500 ETH, moving us closer to our goal. Then came the CoWSwap transformation on April 8th, highlighting that selling and staking have already been operating in parallel for several weeks.
At an ETH price of approximately $2,220.76, 5,000 ETH equivalent to approximately $11.1 million, the ETH staking standard rate at the beginning of April was hovering around 2.73% to 3.00%.
70,000 ETH, generating approximately 1,912 to 2,102 ETH per year, equivalent to approximately $4.25 million to $4.67 million at current prices. One 5,000 ETH sale corresponds to approximately 2.4-2.6x annual yield from the entire 70,000 ETH staking sleeve.
While staking programs improve treasury efficiency and reduce funding requirements, they remain well below the scale needed to replace treasury sales.
The EF’s June 2025 framework sets annual operating costs at 15% of the Treasury and an operating buffer of 2.5 years, meaning fiat reserves equal to 37.5% of the Treasury.
The October 31, 2024 report, which applies only by way of example to EF’s last overall financial snapshot, shows total treasury of $970.2 million and non-crypto assets of $181.5 million, suggesting policy target reserves of approximately $363.8 million.
EF has already publicly added to its stablecoin exposure after that snapshot, deploying 2,400 ETH and approximately $6 million in stablecoins to Morpho in October 2025, and subsequently announcing additional ETH to stablecoin conversions in October 2025 and April 2026.
The current exact size of EF’s fiat-like bucket and whether tokenized RWA holdings have already been added to the material size is still unclear. Therefore, the 2024 snapshot should still be treated as illustrative rather than a substitute for today’s balance sheet.
EF’s own allocation update showed the grant for the first quarter of 2025 at $32.6 million. At today’s ETH price, this is equivalent to approximately 14,700 ETH. The April 8 diversion covers only about 33% of total grants for the quarter, excluding protocol research, staffing, operations and broader industry support.
Yields and borrowings leave you with a fiat-denominated budget, but it still requires regular monetization.
potential consequences
The bullish case for EF is based on simple arithmetic from Treasury, as rising ETH prices and lower long-term investment ratios allow the foundation to maintain dollar buffers while monetizing fewer coins.
| scenario | what will change | Probably the Treasury effect |
|---|---|---|
| bull case | ETH price rises, long-term investment ratio declines | Fewer coins need to be sold to maintain fiat buffers |
| basic case | Mixed strategy continues | Staking, DeFi, borrowing, and regular sales coexist |
| bear case | ETH price falls, spending pressure increases | More ETH may need to be monetized to maintain runway |
| important meaning | Reserve targets continue to be denominated in fiat currencies | When ETH falls, the story of “few sales” collapses. |
In that setting, staking rewards and selective borrowing could reduce quarterly sales and give EF more flexibility in venue selection, whether through OTC blocks, TWAP execution, or conservative DeFi positions.
Then the modernization of the Treasury will appear as a lower cadence, a smaller clip and better execution.
Since the EF’s reserve target is denominated in fiat currencies, the bearish case passes through the same framework in reverse.
If ETH prices fall, foundations may be forced to further monetize to maintain runway, especially if they lean toward a counter-cyclical mission and spend more aggressively in tougher market conditions.
In this setup, a large staking sleeve will still generate yield, but reserve requirements may rise faster than offsetting that yield.
Public expectations built around “less selling” would clash with the balance sheet discipline that the EF had already factored into its policy.
With the conversion of April 8, the discipline was brought back into view. EF’s financial strategy already combined DeFi deployment, stablecoin borrowing, staking, and regular ETH sales.
The market story extended beyond written policies and beyond the foundation’s own post-staking transaction records.
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