On Tuesday, May 21, the Ethereum Foundation made an important announcement regarding the development of its Ethereum 2.0, Plasma platform. The non-profit organization said that it would be investing $30 million over the period of next 12 months.
While all of the committed the fund will be spent on key projects, $19 of it will go to towards “building the ethereum of tomorrow”. This majorly includes developing the “layer 2” scalability project like the Plasma, besides other research and developmental tasks. The Ethereum Foundation also plans to fund the research for Ethereum “Phase 3 and Beyond.”
The Ethereum 2.0 is basically a transformational project involving key partnerships with startups, developers, and academic institutions. The upgrades will take place across the entire decentralized Ethereum ecosystem.
On the other hand, the Ethereum 1.0 is likely to receive $8 million funding over the next 12 months. Some of the important tasks of the Ethereum 1.0 projects include programming languages to write smart contracts on Ethereum and other blockchains, command line tools for developers, and the Ethers.js code library for Ethereum developers. The official blog post notes:
“Ethereum is used in production today to secure billions of dollars of assets and as a base layer for many hundreds of live applications. We believe that it is vital to continue supporting these efforts to ensure that ‘Ethereum 1.0’ continues to be the world’s dominant smart-contract platform.”
The remaining $3 million shall be committed to developer growth and awareness. The money will go towards tasks like developer education and onboarding, supporting “regional ethereum community organizations,” as well as organizing Ethereum’s yearly Devcon conference.
In the last year, the Ethereum Foundation has reportedly spent $27 million offering monetary grants to different projects, a majority of them focused on solving Ethereum’s scalability issues.
The Ethereum Foundation currently holds 0.6% of all the Ether (ETH) tokens in circulation which roughly amounts to $160 million in addition to the cash reserves. The blog post notes that these resources are likely to decrease with time with third-party actors like MolochDao taking up a larger role in supporting the development of the Ethereum ecosystem.
The blog post notes: “Efforts like these give us better leverage from our existing resources, and help build a sustainable path for funding vital projects far into the future”.
In a word with CoinDesk, Ethereum Foundation’s executive director Aya Miyaguchi said:
“I understand that many look to the [Ethereum] Foundation as an important voice even if our intention is to empower other important contributors to ethereum…We’ll continue to release many different types of updates, including the latest from more supported teams very soon.”
The Ethereum Foundation follows a unique “subtraction philosophy” meaning “resisting the natural tendency of organizations to grow and accumulate value within themselves, and ensure instead that this value is created outside the Foundation in the broader Ethereum ecosystem.”