Ethereum Foundation Successfully Wraps Up $143 Million ETH Staking Initiative

The Ethereum Foundation has finalized its staking initiative by completing a total of 70,000 ETH, which is currently valued at around $143 million. This achievement involved a significant deposit of roughly 45,000 ETH, worth approximately $93 million, made during a single on-chain event on April 3, according to data from Arkham Intelligence.

Key Takeaways

The Ethereum Foundation has completed a staking mission of 70,000 ETH.
A deposit of about 45,000 ETH was made on April 3, totaling around $93 million.
The foundation’s staking program began on February 24 and aimed to strengthen its treasury while generating yield.
The staking setup utilizes open-source tools and aims to enhance the security of Ethereum’s proof-of-stake network.
This move helps address criticisms related to the foundation's previous ETH liquidations and aligns its interests with Ethereum's long-term success.

Ethereum cryptocurrency

Overview of the Staking Initiative

The Ethereum Foundation's staking initiative had its beginning on February 24, 2023, with an initial deposit of 2,016 ETH. The organization publicly committed to staking a total of approximately 70,000 ETH, pledging that all generated rewards would be directed back into its treasury. This strategic decision was part of a treasury policy update aimed at producing yield and decreasing reliance on ETH sales for funding operations. The foundation made its largest single-day transfer initially, moving 22,517 ETH, valued at over $46 million, to the Ethereum Beacon Deposit Contract. However, the final deposit made on April 3 surpassed this amount and completed the staking target in one go.

Infrastructure Behind the Staking Program

The staking operations leverage open-source tools developed by Attestant, which include systems called Dirk and Vouch. These tools focus on distributed signing, supporting various minority clients, and establishing a multi-jurisdiction validator infrastructure. The foundation has underscored that this method is not only intended to yield returns but also to bolster the security of Ethereum’s proof-of-stake by adding a transparent and well-resourced validator to the network.

Significance for Ethereum (ETH)

Completing the staking program comes at a crucial time for the Ethereum Foundation. Over the past year, the foundation has encountered ongoing criticism for selling ETH from its treasury. While these sales provided operational cash, they also negatively impacted market sentiment. By staking instead of liquidating their treasury, the foundation addresses these criticisms effectively, aligning its economic motivations with the health of Ethereum’s network in the long term. At a price point of $2,055 per ETH and with an anticipated annualized staking yield of approximately 3–4%, the 70,000 ETH position has the potential to generate between $4 million and $6 million annually for the foundation's operations without the need for further token sales.