Amid rising concerns within the virtual asset community about the Ethereum Foundation (EF)'s spending, Josh Stark from EF shared a detailed breakdown of their 2023 expenditures on his personal X (formerly Twitter) account. The scrutiny increased after DeFi analyst Ignas highlighted on August 26th that EF's expenditures were not clearly documented. Additionally, on August 23rd, the community criticized EF when it was revealed via the on-chain tracking platform LookOnChain that an EF wallet had deposited $35,000 worth of Ethereum, equivalent to $93.8 million, to the Kraken exchange.
The expenditure breakdown for 2023, as presented by Stark, includes the following categories: Applied ZK (Zero-Knowledge) accounted for 10.4%, Community Building for 12.7%, Internal Operations for 7.7%, Developer Platform for 6.5%, Layer 1 (L1) Research and Development (R&D) for 24.9%, Layer 2 (L2) R&D for 1.4%, and New Organizations for 36.5%. Stark emphasized that this breakdown encompasses both internal and external spending, with L1 R&D including contributions from external clients and internal EF researchers. The spending pattern shows that external spending, such as grants, accounted for 62% of the budget, while internal spending was 38%, consistent with the trends observed in 2022.
Internal expenditures covered teams like Geth, Privacy and Scaling Exploration (PSE), Solidity, Cryptography Research, and others, all of which are actively engaged in sharing their progress through various public platforms. External spending primarily involves grants, with a comprehensive list available on the official Ethereum blog detailing grants distributed over the past four years.
Notably, the largest spending category, "New Organizations," which made up 36.5% of the budget, is dedicated to funding new entities that enhance and support the Ethereum ecosystem. Vitalik Buterin added that this category includes entities like the Nomic Foundation, Decentralization Research Center (DRC), L2Beat, and 0xPARC. EF has been increasingly focusing on ecosystem support, with the budget for these initiatives nearly doubling in 2023 compared to the previous year. Additionally, Buterin disclosed that his annual salary is 182,000 Singapore dollars in response to a question from a Twitter user.
