Ethereum protocol researcher Dankrad Feist posted a sharp critique on May 21, arguing that Ethereum is losing ground because no organization is both economically aligned with ETH's success and accountable for delivering it. His solution: build a new entity seeded with a war chest of at least $1 billion, tied directly to ETH's performance. The post reignites a long-running debate about whether Ethereum's commitment to credible neutrality has become a liability in a race where competitors move faster.
Feist's $1 billion proposal
Feist, known for his work on Danksharding and data-availability scaling, spent years full-time at the Ethereum Foundation before moving to a part-time advisor role in October 2025. He now also advises Tempo, an L1 backed by Stripe and Paradigm. In his post, he called a $1 billion war chest "very reasonable" for an ecosystem he pegs at roughly $255 billion market cap. The money would seed an organization whose incentives are directly tied to Ethereum's success — something Feist says doesn't exist today.
Inside the Ethereum Foundation's treasury
As of April 2026, the Ethereum Foundation's Arkham-tracked portfolio stood at about $270 million across 14 addresses, split between ETH and stablecoins. The Foundation completed a 70,000 ETH staking target in early April and has been converting ETH to stablecoins to fund ongoing operations. Its 2023 expenditure was $134.9 million, and a mid-2025 treasury policy caps annual spending at 15% of reserves, aiming to bring that down to 5% over five years. Feist notes the Foundation holds well under 0.1% of the total ETH supply and receives no direct flow of staking rewards or transaction fees — just modest yield from its staked ETH.
Who captures value?
Feist's core argument is that Ethereum's value capture is badly skewed. L2 teams pocket sequencer revenue. VCs take equity. Validators collect issuance. The Foundation, he says, captures the least — leading to under-resourced core execution relative to the ecosystem's size. He contrasts this with other chains where foundations act more like companies, able to move faster because they're better funded and more aligned. Ethereum has historically treated that lack of alignment as a feature, but Feist questions whether that bet still holds.
Is Ethereum really losing?
The claim that Ethereum is losing ground isn't settled. ETH still anchors deep on-chain liquidity and institutional trust. Many attribute any under-execution to a slower upgrade cadence, not a user exodus. But Feist's critique taps into a real tension: the Foundation can't spend aggressively without risking its neutrality, and it can't capture enough value to fund the kind of execution some think is needed. Whether the community will rally behind a $1 billion war chest — or see it as a threat to Ethereum's founding principles — is the open question as the debate moves forward.
