Ethereum Foundation sold 100 ETH on January 8, 2025 and received 329,463 Dai tokens in return. During 2024, EF sold a total of 4,466 ETH, generating $12.61 million in revenue.

These ETH sales, with an average selling price of $2,823, were mostly made before major price drops. These sell-offs sparked controversy among the Ethereum community and traders.

Many users who criticized EF for selling ETH instead of staking it thought that this situation was worrying for the development and security of Ethereum. Many users argued that the Ethereum Foundation should stake these ETHs and thus make the Ethereum network more reliable.

“To be completely neutral, we can’t use the chain we’re trying to protect. Sorry,” one user commented sarcastically, criticizing EF’s approach.

Another trader emphasized the need for EF to stake ETH and cover internal costs using DeFi. However, Ethereum founder Vitalik Buterin defended EF’s decision to sell ETH, offering two main reasons.

Buterin explained two main reasons why the Ethereum Foundation refrained from staking ETH: regulatory concerns and the obligation not to take sides in the event of a hard fork.

1. Regulatory Concerns

Stating that Ethereum is one of the largest cryptocurrency protocols in terms of market value, Buterin stated that a large amount of ETH staking may attract the attention of regulators. Considering Ethereum as a security may lead to regulatory problems after large staking transactions.

Buterin pointed out the importance of preserving the decentralized structure of Ethereum. A large staking volume could subject Ethereum to increased regulation, which could have negative consequences for the community and network.

2. Not Taking Sides in Case of Hard Fork

Buterin stated that staking transactions can create the impression that the Ethereum Foundation is supporting a particular chain during a hard fork.

While the Ethereum community experiences an internal fork from time to time, EF’s support of a particular chain by staking could mean that EF is making its position clear.

This goes against the Ethereum Foundation’s principle of neutrality and may undermine the trust of the community. Buterin emphasized the importance of the Ethereum Foundation remaining equidistant from the entire Ethereum ecosystem.

Vitalik Buterin noted that EF’s withdrawal of ETH may take longer than just selling. Because the number of validators on the Ethereum network can affect these transactions. If EF withdraws ETH alone, this process may take 2.6 days.

However, if a large number of stakers start withdrawing ETH at the same time, it may take up to 58 days for the transaction to complete. Explaining this situation, Buterin emphasized the importance of the complex dynamics and the impact of validators in the Ethereum ecosystem.

Buterin added that the Ethereum Foundation is working on various new methods to minimize these problems. Stating that ETH sales and staking decisions are critical for the long-term development of Ethereum, he explained that they continue their goal of providing more transparency and regulation to the community.