Wrapped Ether from Ethereum price

On June 4, the Ethereum Foundation (EF) officially released its latest Treasury Management Policy, which systematically elaborates on its financial expenditure policy, asset allocation strategy and long-term vision of "Defipunk". The policy aims to enhance the Foundation's financial resilience, support DeFi innovation, and strengthen its value position in the direction of privacy protection and self-custody. Ethereum Foundation's Treasury Management Policy page The role of the EF Treasury is to support the long-term autonomy, sustainability and legitimacy of foundations. The Ethereum Foundation (EF) is expected to continue to be the long-term steward of the ecosystem, but its mandate will gradually narrow. The fiat currency reserves have increased, and heavy money has been "smashed" for product delivery According to the new policy, EF will determine the allocation ratio of fiat currency to ETH using the "operating expenditure ratio × buffer period" model, and maintain the annual spending at a high level of 15%. The Foundation pointed out that 2025-2026 will be a critical stage for the ecosystem, and resources need to be concentrated to promote the implementation of technologies at the protocol layer, including L1 scaling, blob technology, and UX optimization. EF said that 2025–2026 will be a key window to move forward with the implementation of the protocol, and it is expected to maintain 15% of annual spending and set a 2.5-year fiat buffer. This means that the Foundation will need to convert about 37.5% of its coffers into fiat currency to support short- to medium-term investments. According to EF's new Treasury Management Policy, A is the annual operating expense (as a percentage of the current total treasury) and B is the operating buffer (the number of years in the reserve that can support operations) Specifically, the logic of this model can be divided into three levels, corresponding to strategy formulation, amount calculation and execution. The first layer: structural model, setting the asset allocation ratio The Foundation first uses a structural model to define its asset allocation framework. The model multiplies the annual operating expenditure as a percentage of the treasury (A) by the desired operating buffer period (B) to arrive at a target fiat ratio: A × B: Determine the target reserve size denominated in fiat currency. This value determines how often and how much ETH is sold. This layer of the model does not focus on the specific amount, but emphasizes how the foundation should maintain a long-term asset structure and reduce the short-term decision-making pressure caused by currency price fluctuations, which is suitable for the formulation of governance framework or asset allocation policy. According to the data disclosed in the 2024 Ethereum Foundation Report, the total value of the Ethereum Foundation treasury is $970.2 million, a decrease of 39% from the previous disclosure. Of this amount, operating expenses in 2023 will be approximately $134.9 million, or 13.9% of the total value of the treasury. Based on the standard of 15% of the new fiscal annual operating expenditure and a 2.5-year buffer period, EF's target fiat currency reserve ratio is 15% × 2.5, or 37.5%. At present, the foundation's crypto assets account for 81.3%, and under the new standard, the foundation may need to reduce its holdings of nearly 30% of ETH. According to EF's financial report, the Ethereum Foundation's operating expenses in fiscal year 2023 (left) and the proportion of treasury asset allocation in October 2024 (right), according to the new fiscal standards, EF needs to reduce nearly 30% of its crypto asset holdings The second layer: the amount model, which calculates how much fiat currency should be raised After the structure ratio is set, the Foundation applies the target ratio to the current total treasury value and translates it into specific fundraising goals: Target fiat currency reserves = A × B × the current total value of the vault Corresponding to the actual amount, its target fiat currency reserves are about $363 million. This amount model is used to assess the sufficiency of the current fiat currency reserves and whether ETH needs to be sold to raise the difference, which is an important basis for decision-making at the executive level. Layer 3: Execute the model, and work backwards to deduce how much ETH should be held Eventually, in order to achieve the allocation goal of fiat currency and ETH, the Foundation will consider the remaining part of the treasury (i.e., 1 - A × B) as the ETH reserve value and divide it by the current ETH unit price, so as to deduce the amount of ETH that should be held: TotalTreasury - A × B: The target value of the ETH reserve (divided by the ETH unit price to get the amount of ETH held by the core). Target ETH amount = (1 - A × B) × Total Treasury ÷ ETH current price This step translates the strategy model into actual position requirements. Corresponding to the actual amount, the foundation treasury is $970 million, A × B=37.5%, and based on the ETH price of $2,500, the foundation should keep about 242,000 ETH as a core long-term holding asset. Compared with the traditional budget system, this model provides a more flexible asset allocation method: in a bull market, fiat currency can be cashed out in a timely manner to enhance the ability to resist cyclicality; It can also maintain long-term belief in currency holding during market downturns. EF said the board will regularly evaluate two parameters, A and B, to dynamically adjust the asset structure and ensure that resource allocation is synchronized with the strategic cadence. The next two and a half years are considered a critical period for the ecosystem by the Ethereum Foundation, so it is necessary to focus resources on promoting the delivery of important technologies. In 2025, EF will spend about 15% of treasury funds (37.5% of fiat currency reserves) and plans to maintain a legal buffer for spending for 2.5 years. The company plans to reduce annual operating expenses roughly linearly over the next five years, eventually reaching a baseline level of 5% over the long term. Related Reading: Ethereum Foundation 2030 Plan: Slashing ETH Spending to 5%, Actively Supporting Defipunk Optimize asset management with an emphasis on RWA quotas In terms of asset allocation, the Ethereum Foundation (EF) has further clarified its asset allocation framework in the new policy, which aims to balance security, liquidity and long-term stability. In terms of crypto assets, EF said it will seek stable financial returns without violating Ethereum's principles of decentralization and openness. The Foundation prioritizes deployment to audited, permissionless, and transparently structured DeFi protocols, emphasizing protection against potential risks such as smart contracts, governance, stablecoins, and oracles, and avoiding excessive pursuit of high-risk returns. On-chain funds will be flexibly allocated based on market conditions, risk exposure, and yield opportunities, which currently includes independent staking and providing wETH liquidity to mainstream lending protocols. In the future, it is also planned to introduce stablecoin lending and some high-security on-chain RWA products as a complement. In addition, EF evaluates the deviation between actual fiat reserves and operational buffer targets on a quarterly basis, decides whether to sell ETH, and makes a strategic choice between off-chain swaps or on-chain swaps. Compared with the previous strategy of focusing on on-chain returns, EF has explicitly introduced tokenized real-world assets (Tokenized RWAs) as an important component of fiat assets. Its allocation structure is divided into three tiers: immediate liquid assets that cover daily expenses, low-risk assets that match medium- and long-term obligations, and tokenized real-world assets (Tokenized RWAs) that are integrated into a unified strategy management system. This change sends a clear signal: the fund is starting to think more about the stable income tools of the fiat world, with the aim of supporting the sustainability of higher expenses in the short to medium term, rather than relying on market conditions or the fortuitous nature of on-chain returns. It is worth noting that only RWA protocols that meet the conditions of on-chain transparency, auditability, and decentralized governance may be included in the foundation system. Conversely, traditional RWA projects with closed structures that rely on legal trust paths will face a higher barrier. Such adjustments not only improve the robustness of the treasury structure, but also reserve institutional space for further expansion of on-chain asset management paths in the future. At this time, the details of the deployment have not been disclosed. Promulgation of "New Standards for Entrepreneurship" in Ecological Projects In addition, EF has set out clear goals for Cypherpunk in its new fiscal policy, and based on this, it has built a set of evaluation frameworks called "Defipunk", which aims to promote a more decentralized, privacy-friendly, and technology-self-sufficient financial infrastructure. The framework emphasizes six core values: security, open source, financial autonomy, technology instead of trust, freedom through cryptographic tools, and privacy, with a particular focus on privacy at the transaction and on-chain data levels. EF's operating expenses for fiscal 2023, most of which will flow into L1 underlying R&D and the establishment of "new facilities", are likely to be significantly reduced following EF's announcement of layoffs and strategic redirection At the same time, EF has developed a standardized evaluation system for future on-chain deployments. These include permissionless access, self-custody, FLOSS-level open-source protocols, privacy protection options, open and transparent development and governance processes, trust-minimized core logic, manipulation-resistant oracle mechanisms, security audit guarantees, and decentralized user interfaces. According to EF, this evaluation framework will serve as an important reference standard for future treasury fund deployment, encouraging ecological projects to continue to optimize in the direction of security, privacy and decentralization, so as to jointly build a long-term financial ecosystem that is in line with crypto-native values. The Defipunk framework will impact the Ethereum Foundation's funding mechanisms for developers, particularly in terms of privacy, which EF has made clear of its future priorities, emphasizing support for cryptographic transactions, data protection mechanisms, and decentralized user interfaces, and encouraging on-chain anonymity. The Foundation said that "privacy is a key unfinished task for DeFi", and will promote the development of the related ecosystem through strategic funding and research cooperation in the future. This shift in stance could lead to new inflows and long-term endorsements for privacy protocols such as Railgun and anonymous identity projects. Such a policy framework with open standards and evaluation mechanisms marks the beginning of an era that relied heavily on the subjective judgment of core members. For a long time, projects that want to gain "legitimacy" in the Ethereum ecosystem often need to connect with EF through informal channels. Whether it's a project founder looking for a platform, or an investor seeking early access to high-quality targets, EF researchers are seen as a key gateway to resources and discourse. This network-based ecological mode of operation made "Approaching EF" an unavoidable path to success. Related Reading: EF No Dreams Against this backdrop, EF's "Defipunk" assessment framework is particularly significant. It is not only a technical explanation of the rules for the use of funds, but also marks a shift in the concept of ecological governance—from the "consensus politics" driven by the implicit power network to a transparent mechanism based on open standards and value orientation. The Defipunk evaluation system, which focuses on security, decentralization, and privacy protection, provides a clearer institutional path for how future projects can obtain financial support and ecological recognition. In other words, from now on, the project's support will no longer depend solely on whether it has a "good relationship with whom", but whether it is in line with Ethereum's long-term vision and public value goals. This is a loosening of the institutional level, and it is also an important starting point for the return of ecological culture from personal preferences to technical rationality. Reverberations from the community, has ETH bottomed out? While the Ethereum Foundation announced a new fiscal policy and put forward the goal of "reducing costs and increasing efficiency", a series of noteworthy changes are also emerging at the market level. Personnel adjustments within the foundation, strategic bets on ETH in the capital market, and a phased rebound in the ETH/BTC exchange rate have intertwined a more complex ecological structure map. There was a lot of discussion in the community, and there was a lot of discussion in the community, and there were echoes of consensus and disagreement. On June 3rd, EF announced the elimination of some R&D personnel and the reorganization of the original research team into a new department called "Protocol", focusing resources on three major technical directions: L1 extensions, blob extensions, and UX improvements. On the one hand, some R&D personnel will be eliminated, especially those teams that have stayed in the theoretical stage for a long time; On the other hand, the introduction of stricter accountability mechanisms requires the rapid transformation of research results into actual outputs. Co-executive director Hsiao-Wei Weng said on social media X that he hoped the new structure would drive the core project forward more efficiently. Previously, the verbal and written criticism of the Ethereum Foundation (EF) has been protracted, and the weak trend of Ethereum in the past few months has also promoted the fermentation of community dissatisfaction, many famous investors and developers have expressed their opinions and dissatisfaction with EF, and some core members have left EF to transfer their research and resources to the outside of the foundation, indicating that EF's internal differences have reached the point of irreconcilability, and EF has been directly pushed to the forefront. Related reading: "How long can the Ethereum Foundation last if the core members left to set up "Shanzhai EF"? 》 As a result, some community voices see the restructuring of the Ethereum Foundation as a "self-correction" of the Foundation in response to external criticism. Some developers have pointed out that this is a necessary focus adjustment, which is expected to focus more efforts on the core evolution of the protocol layer. Around the same time, SharpLink Gaming, a U.S.-listed company, announced its Ethereum treasury reserve strategy, planning to raise $425 million for long-term ETH holdings, and the leading investor behind it is Consensys, an important technology enabler of the Ethereum ecosystem. This operation, known as the "ETH version of microstrategy", has been interpreted in the community as a repricing of Ethereum by the traditional capital market, and is also seen as a public endorsement of Consensys' technical roadmap. SharpLink's big bet quickly boosted market confidence, with ETH price rising 4% to $2,639 in 24 hours following the May 28 announcement, up 50% over the past month. Related reading: "Spending $425 million on ETH microstrategy, "E guards" abandon political correctness" On June 4, the ETH/BTC exchange rate rose by more than 2% in a short period of time, sparking market attention on the direction of the skew of funds. Traders see it as a signal of a regression in the relative value of ETH. Some analysts believe that ETH is currently approaching the apex area of a large technical pattern, and if it breaks through, the price is expected to rise to $2,000 or $3,000, and the impetus behind it may come from improving fundamentals, or it may only be driven by large capital entry. Related Reading: "10x Research: ETH Moves More Resilient Than Expected, Approaching the Apex of Key Technology Patterns" But what is more noteworthy is that in contrast to the Foundation's reduction of operating expenses and the high-profile increase of market funds in ETH, the focus of Ethereum's narrative is shifting from "institutional incentives" to "market consensus", and the tension between technological promotion and capital will is being staged simultaneously. Taken together, EF's current strategy to reduce costs and increase efficiency reflects both fiscal prudence and a repositioning of the boundaries of its role. In the context of the continuous evolution of decentralized governance, the collaborative relationship between foundations, technology companies, capital institutions, and the developer community is also moving towards a new stage of more complex but potentially more efficient.

Review: Felix, PANews The Ethereum Foundation released its new fiscal policy on June 4, which outlines how the Foundation will manage its reserves, deploy funds in DeFi protocols, and privacy assessment criteria, while maintaining Ethereum's commitment to self-sovereignty and neutrality. The Ethereum Foundation has announced that it will adopt a more structured and transparent reserve policy, tying operating costs and cash requirements to ETH reserves and sales to strengthen its financial position. This policy is very different from the foundation's historically passive capital stance. Cut back on expenses and regulate the sale of ETH In recent months, the Ethereum Foundation's unexpected sale of ETH has sparked a backlash from the community, with some critics claiming that the Foundation's series of moves have undermined trust in the Foundation. Or because of these doubts, the Foundation announced a complete update of its asset management strategy. The Foundation's annual operating costs (measured as a percentage of Foundation funds) and years of operation will be reassessed periodically, taking into account market dynamics and community input, to ensure that the Foundation's short-term operations are aligned with its long-term strategy. The goal is to reduce annual spending from 15% to 5% of assets by 2030. Currently, the Ethereum Foundation is only 2.5 years away from running out of cash, so "the next 18 months will be critical." In addition to this, the Foundation calculates the statutory reserve requirement by multiplying the fixed annual operating expense target (currently set at 15%) by 2.5 years of operating time. Automatically sell ETH only when cash reserves fall below the 2.5-year spending buffer (about 37.5% of the vault). In addition, in order to continue the trend of working more closely with the DeFi ecosystem, the Foundation will also pursue funding strategies, including solo staking and the provision of wETH to yield-based lending protocols. It may also borrow stablecoins and seek higher on-chain yields through RWA exposure and DeFi allocation. In keeping with its transparency commitments, the Foundation will also publish quarterly and annual reports outlining its asset holdings, investment performance, and any significant developments during each period. As of October 31, 2024, the Foundation's total reserves are approximately $970.2 million, including $788.7 million in crypto assets and $181.5 million in non-crypto assets. Adopt the "Defipunk" principle to evaluate DeFi protocols The policy also sets out a documented commitment to privacy, which the Foundation defines as "a fundamental civil liberty" in an increasingly monitored financial environment. Through a new internal rule called "Defipunk", the Foundation will evaluate potential DeFi partners based on a set of criteria: permissionless access, self-custody, open-source licensing, and technical privacy features such as transaction masking. DeFi protocols that fail to meet the criteria may still be eligible, but only if credible progress towards these ideals has been demonstrated. The foundation also called on employees who are "involved in fund management" to also "upskill" by using open-source, privacy-preserving tools. Employees involved in financial management are expected to use and/or contribute to open-source privacy tools in order to complete their day-to-day work, especially if they need to improve their skills in the relevant field. In the new policy, the Foundation underlines its commitment to the core values of "Cypherpunk". "Through research, advocacy, and strategic capital deployment, the Foundation can help foster an Ethereum-native financial ecosystem that asserts self-sovereignty and sustains an 'open society in the electronic age' at scale." It is worth mentioning that this may also put the foundation at odds with regulatory trends in the United States and Europe, where policymakers are increasingly prioritizing transparency and compliance over crypto privacy. Related reading: Ethereum Foundation's first public layoff, strategic adjustment sparked controversy again, and the foundation model failed?

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Original title: Ethereum Foundation Treasury Policy Original author: Hsiao-Wei Wang Original compilation: KarenZ, Foresight News TL; DR 1. In 2025, the Ethereum Foundation (EF) will spend about 15% of its treasury funds, with the goal of maintaining a 2.5-year spending buffer denominated in fiat currency, after which it will gradually reduce the proportion of spending to eventually move towards a sustainable level (possibly 5% per year). 2. Crypto asset policy: The core considerations of the on-chain portfolio include, but are not limited to: security and reliability, balance between returns and risks, and the deep goals of Ethereum (supporting highly secure, decentralized, and open-source cypherpunk applications). · ETH Sales: EF will periodically calculate the deviation of fiat-denominated assets in the treasury from the operating expenditure "runway" target, and determine whether and how much ETH to sell in the next three months. · ETH deployment: Current strategies, including solo staking and the provision of wETH to established lending protocols, are constantly being re-evaluated. EF may also borrow stablecoins in search of higher on-chain yields. 3. Fiat-Denominated Asset Policy: EF will allocate its fiat assets to the following areas: immediate liquid assets (cash and other highly liquid fiat currency instruments), liability-matched reserves (term deposits, investment-grade bonds, and other low-risk instruments matched with long-term debt), and tokenized RWA. 4. Transparency policy: The financial team provides quarterly reports and annual reports. The annual report will contain more treasury-related information, including an overview of major treasury allocations (such as fiat currency, idle ETH, and percentage of deployed ETH). 5. Cypherpunk Goals: Through research, advocacy, and funding allocation, EF will promote the establishment of a "Defipunk" evaluation framework based on cypherpunk principles, which will feature security, open source, financial sovereignty, technical solutions over trust solutions, and the active use of cryptography tools to protect civil liberties and privacy. The original text is compiled as follows: The Ethereum Foundation's (EF) mission is to strengthen the Ethereum ecosystem and stay true to its long-term goal: to ensure that "applications run exactly as programmed, avoiding the possibility of downtime, censorship, fraud, or third-party interference." The EF Treasury is designed to preserve the long-term autonomy, sustainability, and legitimacy of the Foundation. Funding needs to be balanced between the pursuit of out-of-benchmark returns and fulfilling the role of guardian of the Ethereum ecosystem, with a particular focus on the DeFi space. This document clarifies the policy framework for EF's treasury management and sets out key metrics and considerations. Macro policy To achieve its goals, EF will develop and regularly refine its asset-liability management policies and advanced funding allocation strategies to manage assets with risk management, maturity and liquidity considerations, while remaining consistent with Ethereum's core principles. Focus on two variables: A: Annual operating expenses (as a percentage of the current treasury) B: Operating buffer period (the number of years that can be covered by the reserve of operating funds) Thereinto: A × B: Decide on the target value of the reserve (off-chain or on-chain) denominated in fiat currency, which directly affects the size and frequency of ETH sales. (Total Treasury - A × B): Defines the value of ETH reserves, divided by the ETH price to get the amount of ETH held by the core holdings. The Board and management regularly re-evaluate these two variables, weighing market dynamics against community input to ensure that short-term operations are aligned with long-term strategies. Two additional points were paid to the assessment: (1) the identification of key years in which ecological participation needs to be strengthened; (2) Maintain a countercyclical stance - the bear market increases support and the bull market contracts moderately. The current target is A=15% (annual operating expenditure as a percentage of treasury funds 15%) and B=2.5 years (buffer period). This policy reflects the Ethereum Foundation's determination that 2025-2026 is a critical period for Ethereum, and that resources need to be focused on advancing important deliveries. EF plans to fulfill its steward," role for a long time, but plans to gradually narrow its responsibilities and intend to reduce annual operating expenses linearly over the next five years, eventually maintaining a long-term benchmark of 5% (in line with donor practice). The path and benchmark will be adjusted as the situation changes. Crypto Asset Policy EF will manage treasury assets in a manner consistent with Ethereum's fundamental principles, pursuing reasonable returns. Core considerations for on-chain portfolios include, but are not limited to: · Security & Reliability: Prioritize proven, tamper-proof, audited, no-license agreements; Support positive "positive sum game" participants in the Ethereum DeFi ecosystem; avoid exacerbating systemic risks; Continuously evaluate the project's attack vectors and risks, such as smart contracts, governance, custodial (e.g., stablecoins), oracle risks, etc. · Balance of returns and risks: Choose conservative options with high liquidity, rather than blindly chasing high returns. It is necessary to protect against not only the risk of capital loss, but also the risk of liquidity and overall portfolio flexibility. Slightly riskier configurations may be made, but are limited in scale and managed separately. In any case, the goal is a modest percentage of the total value locked (TVL) of a single project. · Ethereum's deep goal: to support highly secure, decentralized, open-source Cypherpunk applications. The ideal protocol should minimize trust dependencies, be composable, and maximize privacy. We will adjust our capital allocation frequently in response to market changes, risk diversification or new income opportunities. Actions should not be interpreted as negative. ETH for sale EF will periodically calculate the deviation of fiat-denominated assets in the treasury from the OPEX Buffer ("B") target and determine whether and how much ETH to sell over the next three months. These sales are typically made through fiat currency exit channels or on-chain exchanging for fiat currency assets. EF will periodically calculate the deviation of the fiat reserves from the buffer target (B) and determine the amount of ETH to be sold in the next three months, if any. The sale is usually done through a fiat channel or on-chain exchange. ETH Deployment Current strategies include solo staking and providing wETH to established lending protocols. Core deployments are constantly being re-evaluated, but the goal is long-term. EF may also borrow stablecoins in search of higher on-chain yields. EF's management and advisors will review candidate agreements based on contract security, liquidity risk, depegging risk, and other factors. As the DeFi ecosystem matures, EF plans to incorporate a portion of its on-chain allocations, including heavily vetted pools and tokenized RWAs, into its fiat reserves. Fiat-denominated asset policy EF will allocate its fiat assets to the following areas: · Instant Liquid Assets: Cash and other highly liquid fiat currency instruments to meet real-time operational needs; · Liability Matching Reserves: Term deposits, investment-grade bonds, and other low-risk instruments matched to long-term debt; · Tokenized RWAs: Follow the same strategic objectives and risk guidelines as native crypto assets. Transparency Policy EF Co-Executive Directors are accountable to the Board of Directors for treasury management. To ensure transparency, accountability and informed oversight, a structured internal reporting mechanism has been put in place. Reports are prepared and maintained by the finance team and distributed according to scope and sensitivity. Quarterly reports The finance team provides quarterly reports to the Board and management, including: Performance (absolute and benchmarking) All positions (open and closed since the last report) Summary of major incidents (operations: processes, infrastructure, security updates/incidents; Ecosystem Engagement: Conferences, Partnerships, etc.) annual report The EF Annual Report will contain more treasury-related information, including an overview of major treasury allocations (such as fiat currency, idle ETH, and percentage of deployed ETH). Cypherpunk target EF (through research, advocacy and funding) will drive the development of a "Defipunk" assessment framework based on cypherpunk principles, with features including: · security · open source · Financial sovereignty · Technical solutions take precedence over trust solutions (e.g., multi-signature, etc.) · Actively use cryptography tools to protect civil liberties and privacy · privacy Long overlooked in DeFi, but crucial. Privacy protects market participants from digital surveillance (e.g., front-running, sandwich attacks, liquidation sniping, targeted phishing, profiling, and data-based coercion) and physical threats. EF should actively support the project's Defipunk transformation Ethereum is expected to attract exponentially growing capital, talent, and innovation dynamism. However, growth is often path-dependent: standards adopted during chaotic periods of rapid growth are solidified into legacy constraints, while transparency-focused designs may default to lock-in monitoring mechanisms. Existing systems tend to exert subtle pressures to shrink the design space for new DeFi primitives and limit privacy-focused innovation. The Ethereum Foundation will defend itself against these pressures. Through research, advocacy, and strategic capital allocation, EF can help foster an Ethereum-native financial ecosystem that secures self-sovereignty and sustains an "open society in the electronic age" at scale. Translating this vision into actual infrastructure requires effort. Today, building a cypherpunk DeFi protocol faces a number of challenges: higher privacy-related gas fees, user experience friction, difficulty launching liquidity, the need for stricter auditing related to technical complexity and immutability, and the presence of privacy opponents. As a result, many of today's DeFi ecosystems rely on centralized elements: backdoor closure mechanisms or fund withdrawal capabilities, over-reliance on multisig or multi-party computation (MPC), widespread use of whitelisting, centralized and monitored user interfaces, and a general lack of on-chain privacy – all of which expose the DeFi market and participants to systemic vulnerabilities. Privacy, in particular, needs to be treated correctly. As the Cypherpunk's Manifesto states, "Privacy must be part of the social contract for it to be universal." Privacy has an inherent network effect, but has received little attention so far. This suggests that strong early-stage institutional support from entities such as EF is uniquely valuable in shifting the balance towards a more privacy-focused DeFi landscape. EF has the power to help steer DeFi towards these goals. For example: · Supporting emerging DeFi protocols in developing privacy features. · Mature protocols are encouraged to strengthen Defipunk attributes through research collaboration, liquidity support, legitimacy, and other resources. · Promote the development of decentralized user interfaces (UIs). Defipunk starts with itself Advocating for open source, privacy, and other Defipunk goals is not limited to external EF, but also includes possible internal operations within EF itself. Applying Defipunk principles to EF's own treasury management was a critical first step. More broadly, EF may use security software tools, establish prudent operational structures to support all qualified contributors (including anonymous and pseudonymous contributors), and otherwise improve its security and privacy practices. This will help EF uphold its principles and strengthen its strength, stability, and firmness. Defipunk standard The following are specific criteria for internal evaluation of protocols and user interfaces designed to encourage new project initiation and improvement of existing projects. These standards will apply to all future on-chain configurations of EF. While some standards, such as permissionless access, self-hosting, and free and open source software, are direct binary determinants of configuration, others are more complex. Currently, a project does not need to be "ideal" in every dimension. We seek credible roadmaps for progress and improvement, not perfection on day one. We make this framework public in order to provide clarity and consensus on these dimensions of EF decision-making, while allowing the community to consider, adjust, or apply these standards. · Permissionless access: Can anyone interact with the core smart contract without KYC or whitelisting? · Self-hosting: Does the protocol allow users to remain self-hosted and make it the default option? · Free and Open Source Software (FLOSS): Is the contract code free and open source software, under a copyleft license (e.g., AGPL) or a permissive license (e.g., MIT, Apache)? Providing only source code, such as BSL, is not eligible. Privacy: · Transactions: Is there an option to shield the source/destination/amount of the transaction? · Status: Is the user/personal data and/or position information masked on-chain? · Data: Does the protocol (and its typical UI) avoid collecting unnecessary user data (such as user agents) and personal data (such as IP addresses)? Open development process: Is the development process reasonable and transparent? Is the code repository publicly accessible and actively maintained? Is there a clear record and version history of protocol changes? Is the decision-making process for upgrades, parameters, and roadmaps visible? The core logic of maximum trustlessness: · Immutability: Is the underlying logic of the protocol non-upgradeable or governed by a highly decentralized, time-locked, and transparent process? (Avoid admin keys with broad powers.) ） · Maximum-viable cryptoeconomics: Does the protocol rely maximum on cryptographic guarantees and economic incentives, and reduce the use of legal wrappers (e.g., collateral guarantees) or off-chain execution to the minimum required for core functionality? · Oracle dependencies: 1. Do you minimize your reliance on oracles and minimize losses when oracles are attacked? 2. Do you use strong, decentralized, governance-minimized, and manipulation-resistant oracles when oracles are needed? Overall Safety: · Is the contract audited and has a process in place to track the submitted hash vs. the last deployed hash, ideally including monitoring/alerting when discrepancies change? · Are contract properties formally verified or at least bytecode verified on a blockchain explorer? Distributed User Interface: Are there multiple independent UIs? Is the main UI open source and hosted in a decentralized manner? Can users interact directly with the contract? Long-term mission EF is here to stay, so a robust long-term treasury management policy is needed. We have long held ETH alone, but are now moving towards staking and DeFi, both to enhance financial sustainability and to support a key application category that is providing users with the promise of permissionless and secure access to the infrastructure of basic civilization. We would like to thank the following Ethereum Foundation (EF) members for their valuable comments and feedback on the draft document: Bastian Aue, Vitalik Buterin, Bogdan Popa, Tomasz Stańczak, Fredrik Svantes, Yoav Weiss, Dankrad Feist, Tim Beiko, Nicolas Consigny, Nixo, Alex Stokes, Ladislaus and Joseph Schweitzer. We would like to thank kpk, Steakhouse Financial, and pcaversaccio for their insights and final review of this document. Link to original article