The Ethereum Foundation sees its ETH sales as “an investment in the development of the protocol”.
Ethereum ecosystem participants question those EF movements.
During his participation in the Blockchain Summit event of Montevideo, Uruguay, held on July 25, Uruguayan developer Ignacio Hagopian, a member of the Ethereum Foundation (Fe), spoke with cryptootics and, in this first part, referred to the role of that organism within the Ethereum ecosystem.
In particular, about the criticisms of the community towards the EF for the sales of its reserves in Ethher (eth), Hagopian sentenced:
“It is impossible to pretend that the Ethereum Foundation will work without selling ETH.”
Ignacio Hagopian, member of the Ethereum Foundation.
That statement highlights a tension within the ecosystem. The expectation that ‘central’ entities do not effect practices that could affect the price of the assetin the face of the reality that those same entities require liquidity to operate.
In this case, according to the developer, the EF (non -profit entity created to promote and sustain the development of the protocol) uses part of its reserves in ETH to finance tasks ranging from the Base software maintenance up to the support of independent developers and researchers.
Thus, the financing of the EF would fulfill a necessary role, but that must be handled cautiously for Hagopian:
“It is a risk of centralization, because in the end the one controls the Ethereum Foundation ends up controlling Ethereum, and that is something we do not want.”
Ignacio Hagopian, member of the Ethereum Foundation.
The EF, he said, is The only actor to which everyone goes for help and resources, which places it in a privilege position, but also of responsibility.
The key, for Hagopian, is to calibrate the intervention according to the time that Ethereum is going through:
“Depending on what stage Ethereum is in your life, you need more help from the Ethereum Foundation in terms of resources, in solving problems in a more direct way.”
Ignacio Hagopian, member of the Ethereum Foundation.
And he added that, as the protocol wins adoption and consolidates, The role of the EF could be reduced: “Able that later, when the adoption is bigger and more consolidated, we can retire in a more aggressive way and get less involved.”
ETH sales as investment in the protocol
Criticisms towards ETH sales by the Ethereum Foundation often focus on the possible bearish impact on the price of the asset. However, Hagopian considers that these operations should be understood as an investment, not as an expense:
“If Eth sells today to make the protocol better, in theory that will make Ethereum be more in the future too.”
Ignacio Hagopian, member of the Ethereum Foundation.
In that line, he stressed that the organization acts with a long -term vision and that it is not guided by short -range speculative projections.
“Obviously if you see the short term and says, ‘I don’t want you to sell 100 million dollars next month because it doesn’t work for what I thought about eight months,” I can understand. But the Ethereum Foundation sees things in the long term, ”he said.
From this perspective, demand that the EF does not liquidate part of its eth holdings implies, according to Hagopian, an ignorance of the basic functioning of the organization:
“The important thing is to realize that, if the Ethereum Foundation sells ETH, it is because it has to pay the salary to people who work in the protocol. If you say, ‘I do not want to sell eth’, which is saying indirectly is that it does not want the Ethereum Foundation to pay a lot of people who work in the protocol to solve the problems.”
Ignacio Hagopian, member of the Ethereum Foundation.
The three strategic areas indicated by Ethereum Foundation
During the interview, Hagopian also shared which are the three areas in which the EF suggests to focus on this stage of Ethereum’s development:
- The scalability of Layer 1 (base layer).
- The strengthening of the Layer 2 solution ecosystem (second layers).
- The user experience and interoperability between networks.
According to Hagopian, in the next “One, two or three years” The organization plans to get involved even more actively in the improvement of the protocol and support to applications, depending on the needs that arise.
These priorities reflect a technical consolidation strategy that seeks to improve efficiency, reduce transaction costs and facilitate the use of Ethereum as a decentralized applications infrastructure.
However, that a single entity proposes Marcos de Action may imply risks if its influence is not balanced by other actors.
The concentration of decisions around what should be prioritized, or who is assigned resources, can lead to a form of centralization which contradicts the open and decentralized spirit that characterizes the protocol.
“Ethereum is a public good,” says Ignacio Hagopian
Finally, when expanding on the institutional role of the organization, Hagopian said:
“The Ethereum Foundation aims to materialize the long -term vision of Ethereum. Defend values, support developers and protocol researchers who do not have any financial support, because Ethereum is a public good.”
Ignacio Hagopian, member of the Ethereum Foundation.
The concept of Public Good (In Spanish, public good) refers to a good that is not excludable or rival, that is, its use by a person does not prevent use by others and to which access cannot be denied.
In this context, Hagopian suggests that Ethereum works as a common infrastructurethat benefits the whole of the ecosystem participants and that, therefore, needs to be collectively sustained.
