ETC management: The Ethereum Foundation sold 70,000 ETH at ATH because of responsible treasury management
As AZCoin News mentioned, it seems that the Ethereum Foundation (EF) will no longer fund internal development teams. According to many people, the reason comes from the fact that EF no longer has enough money when ETH price keeps decreasing over time. However, this is entirely wrong. Ethereum co-founder Vitalik Buterin has confirmed that EF has sold about 70,000 ETH at Ethereum’s ATH. At about $ 1,400, EF seems to have made nearly $ 100 million by selling the Altcoin.
Bob Summerwill, the Executive Director at ETC Cooperative (right)
The Ethereum Foundation was in the news
Bob Summerwill, the Executive Director at ETC Cooperative, said:
“The Ethereum Foundation did it right when it did not sell everything but only a significant amount of money.”
To prove his argument, he made two cases of terrible treasury management failures in the past.
The first is the crowd sale itself, where it focused on gathering and hodling Bitcoin. Even when Bitcoin price drops, the holders continued to HODL. This led to them losing half of their raised value in a short time.
He shared:
“Many people have advised them. For example, you have raised Bitcoin, but you should sell some Bitcoin to fund your operation. And then the answer is what? We are true believers. We are true crypto believers, and we HODL, we don’t sell.”
According to Summerwill, cashout is responsible for treasury management. This is one thing to do to ensure you can pay for everyone. This is a more practical thing than theory.
The second case started in 2015. It is the time when the fund encounters a significant deficit in the year and almost runs out of money. However, the skyrocketing ETH price is what saved them.
He said:
“You know, after the crowd sale, the ETH price hasn’t changed for about a year. It didn’t drop even if it’s 50 cents or $ 1. But then, in early 2016, when ETH went up to $ 4 or $ 5, we feel saved. We’ve got a year and a half or any runway now. And things have continued to grow faster since then.”
And while confirming the Ethereum Foundation selling ETH is a good move, Summerwill is still inclined to the fact that the Fund lacks transparency.
He frankly said:
“I hear about this, a few months or a year later. Well, where was transparency at the time? If the organization were a public company, someone would have to go to jail for it. You know. You cannot do that. You are responsible for disclosing sales, not that you are not making them.”
Foundations need to issue quarterly budget statements or reports that highlight the platform’s activities. However, he points out that this is very different from Litecoin creator Charlie Lee, as he has just annoyed people. Lee sold his stash to become rich. The foundation has sold some community sales to its fund developers. Vitalik did not get rich from these sales. That’s the difference.
Read more:
- Revealed Message To Renounce The US Citizenship, Ethereum Researcher Virgil Griffith Has Been Denied Bail
- Ethereum’s Vitalik Buterin: Layer 1 Base Level Can’t Too Powerful But Need Powerful Enough To Support The Complexity Of Applications On Layer 2