Ethereum Foundation Earmarks $20M For ETH 2.0
The Foundation Plans to spend 20% of its reserves over the next year.
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The Ethereum Foundation has released its Spring 2019 update, reporting the status of its ongoing initiatives and outlining the its plans for the next year. Although it’s hardly bedtime reading, the blog post outlines the development plans for the largest smart-contract ecosystem, including a substantial investment in Ethereum’s next upgrade.
$30 Million Investment Over the Next 12 Months
The biggest revelation is that the Foundation has earmarked $30 million to invest in the Ethereum ecosystem over the next twelve months. Of this, $19 million will be allocated to developing “the Ethereum of tomorrow,” aka Ethereum 2.0.
The 2.0 initiatives include state channels and the Plasma scaling protocol as second-layer solutions, zero-knowledge R&D, and development of smart contract languages. As the post explains, over the past year Ethereum 2.0 advanced from a research project to an engineering effort. Therefore, the funding will be spent on engineering activities as well as attracting key developer talent from within the academic community.
As is to be expected in a new and burgeoning sector, developer talent is one of the biggest bottlenecks. The Foundation is now opting to tap into academic institutions as part of its future development plans. From the $30m allocation, $3m is being put towards developer relations, education, and onboarding. The body is also planning a specific focus on Asia, given the opportunities for growth.
A further $8m will be allocated to “the Ethereum of today,” sustaining Ethereum’s position as the worlds biggest smart contract platform. On a tactical level, these funds will be directed into ongoing initiatives. These include Geth, which is an implementation of an Ethereum node in the Go programming language, and Solidity, Ethereum’s native programming language.
Other Key Points
While the $30m investment is the main headline, the Foundation also took the opportunity to clarify its role in the broader Ethereum ecosystem.
The Foundation holds 0.6% of all circulating ETH (around $155m at today’s prices) as well as cash reserves. Since these reserves will deplete over time, the Foundation will also encourage funding from other sources.
According to the update, the Foundation intends to take on a more active voice in the Ethereum community, where it can “bring attention to important but relatively unknown projects, [and] share valuable information about Ethereum’s progress with the public.”
Keeping Ahead Of the Crowd
Ethereum’s first-mover advantage is rapidly diminishing, with stiff competition from the likes of EOS, TRON, and Zilliqa. After frustrating delays with the Casper and sharding protocols, the investment of 20% of the Foundation’s ETH reserves in development should be encouraging to ETH investors.
It will also help links with academic and technical communities outside the crypto world, attracting much-needed talent as well as building a solid marketing base for bringing in more outside investment.
Despite the challenges, ether tokens continue to perform well, with a healthy medium-term outlook. Overall, Ethereum is continuing to hold its own, even in the face of heavy competition.