The Ethereum Foundation suddenly announced the suspension of a $3 million open grant! The fund reallocation has sparked heated discussions in the community.

The Ethereum Foundation (EF) announced the suspension of the "Open Grant" program launched in 2018, which has provided over $3 million in funding to more than 100 projects. The official statement indicated that this move aims to reallocate funds, drop the annual spending rate to around 5%, and invest more resources into core areas such as Ethereum Mainnet scaling, user experience (UX) optimization, and Layer 2 interoperability.

Six-Year Plan Halted: $3 Million Funding Temporarily Suspended

Since its launch in 2018, EF's "Ecosystem Support Program" (ESP) has provided funding support for various areas such as development tools, research, community building, infrastructure, and open standards, covering technical projects such as Commit-Boost, BundleBear, ZK Playbook, as well as the semi-official Ethereum CryptoPunk Conference.

However, the Ethereum Foundation pointed out in its latest announcement that a large number of applications have consumed a significant amount of the team's time and resources, limiting its ability to explore new strategic opportunities. Therefore, it has decided to suspend the program and reassess its funding allocation strategy.

Financial Strategy Shift: Spending Rate Drops to 5%

According to the latest financial report, EF plans to gradually drop its annual expenditure rate to around 5%, while maintaining a statutory expenditure buffer of 2.5 years. In 2023, EF's largest single expenditure was on "new institutions," amounting to $47.4 million, up from $28.6 million in 2022.

The Ethereum Foundation stated that in the future, approximately 15% of the treasury funds will be used to promote core infrastructure and public goods, while optimizing the efficiency of fund usage to ensure long-term sustainable development.

Organizational Structure Upgrade: Co-Executive Directors Take Office

To align with the strategic transformation, EF has appointed Hsiao-Wei Wang and Tomasz K. Stańczak as Co-Executive Directors, responsible for leading organizational operations and technical direction. In the coming months, the two will focus on optimizing the Ethereum Mainnet with blobs and transaction storage systems, as well as driving UX improvements, including Layer 2 interoperability and application layer development.

The Ethereum Foundation emphasizes that these changes mark a new chapter for the ESP, aiming to more efficiently support the builders, researchers, and contributors driving the development of Ethereum.

Community Response and Future Outlook

Although the suspension of subsidies has raised concerns among some developers, there is also a viewpoint that concentrating funds on core infrastructure will accelerate the technical evolution of Ethereum. With the expansion of the L2 ecosystem, the improvement of cross-chain interoperability, and the continued investment in public goods, EF's strategic adjustments may bring longer-term growth momentum to the Ethereum ecosystem.

Conclusion

The Ethereum Foundation has suspended a $3 million open grant program, marking a significant shift in its funding strategy and organizational structure. From reducing expenditure rates to focusing on core technologies, the Ethereum Foundation is paving the way for the long-term sustainability of Ethereum. In the coming months, the community will closely monitor whether this transformation can lead to more efficient resource allocation and stronger ecological competitiveness.