The Ethereum Foundation (EF) has unveiled plans to convert 1,000 Ether (ETH) into stablecoins to support research, grants, and donations, in line with its broader treasury strategy and involvement in funding decentralized finance (DeFi) initiatives.
This transaction, valued at about $4.5 million at current market rates, was carried out through CoW Swap, a decentralized trading protocol that consolidates liquidity from various exchanges to provide users with competitive rates without depending on a centralized intermediary.
Neither the foundation’s announcement nor its treasury policy indicated which stablecoins it would receive in exchange for the ETH.
This recent conversion follows EF’s prior announcement in September about their intention to convert 10,000 ETH into stablecoins over several weeks. However, Friday’s transaction seems to be distinct from that effort, given its smaller size and use of CoW Swap instead of a centralized exchange.
According to the Ethereum Foundation Treasury Policy, EF aims to “balance between seeking returns above a benchmark rate and extending EF’s role as a steward of the Ethereum ecosystem, focusing particularly on DeFi.”
The growing use of stablecoins coincides with EF temporarily pausing open grant submissions to its Ecosystem Support Program, citing an overwhelming number of applications. The foundation indicated it will prioritize funding for the network’s most critical needs.
In April, EF also announced a leadership restructuring to enhance strategic and operational management. The foundation appointed Hsiao-Wei Wang and Tomasz K. Stańczak as co-executive directors, both having previously held roles within EF. In June, the foundation laid off staff and restructured its core development team.
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Vitalik Buterin emphasizes DeFi
Since its inception, Ethereum has maintained its position as the primary platform for DeFi applications. Despite rising competition from other blockchain networks, Ethereum still represents approximately 68% of total value locked (TVL) across DeFi platforms, according to industry reports.
Ethereum co-founder Vitalik Buterin recently reaffirmed the network’s commitment to decentralized finance, suggesting that “low-risk” DeFi applications could establish a more sustainable revenue model for the ecosystem, akin to Google Search’s role in Google’s business structure.
“Low-risk DeFi can fulfill a similar function for Ethereum,” Buterin wrote, highlighting “the essential roles of payments and savings, as well as well-established tools such as synthetic assets and fully collateralized lending.”
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