Ethereum News Today: Ethereum Foundation's TWAP Move: A Strategic Bet on DeFi's Future

The Ethereum Foundation executed a significant liquidity maneuver on October 3, 2025, converting 1,000 ETH-valued at approximately $4.5 million at the time-into stablecoins via CoWSwap's Time-Weighted Average Price (TWAP) feature. This decentralized execution strategy was designed to minimize market impact while securing funds for research, grants, and ecosystem donations. The transaction, announced via the foundation's official social media channels, aligns with its broader treasury strategy, which balances financial returns with its stewardship role in the Ethereum ecosystem, particularly in decentralized finance (DeFi) .

This move follows a larger ETH-to-stablecoin conversion in September 2025, during which the foundation swapped 10,000 ETH ($43.6 million) on centralized exchanges. The October 3 transaction, however, marks a deliberate shift toward decentralized execution platforms. By leveraging CoWSwap's TWAP mechanism, the foundation emphasized its commitment to supporting DeFi infrastructure while maintaining operational flexibility. The use of stablecoins, which are pegged to fiat currencies, ensures immediate liquidity for ongoing projects and grants without exposing the foundation to cryptocurrency price volatility .

The foundation's treasury strategy has evolved in response to broader financial pressures. In recent months, it temporarily paused open grant submissions under its Ecosystem Support Program to prioritize urgent funding needs and reduce burn rates. Critics on social media platforms have debated the merits of alternative strategies, such as borrowing against ETH via DeFi lending protocols or engaging in private treasury deals. However, the foundation has maintained its focus on structured asset management, citing its June 2024 treasury policy, which emphasizes balancing risk, liquidity, and alignment with Ethereum's core principles .

Ethereum's dominance in the DeFi sector remains a critical factor in these decisions. According to DeFiLlama data, Ethereum accounts for approximately 61% of total value locked (TVL) in DeFi, far ahead of competitors like Solana and Bitcoin. The foundation's continued investment in DeFi projects, including low-risk tools for payments and savings, underscores its role in sustaining the network's growth. Co-founder Vitalik Buterin has highlighted the importance of such applications in creating a self-sustaining ecosystem, drawing parallels to foundational services like Google Search .

The foundation's leadership has also undergone restructuring to enhance strategic oversight. In April 2025, Hsiao-Wei Wang and Tomasz K. Stańczak were appointed as co-executive directors, followed by team reorganization and staff reductions in June to improve operational efficiency. These changes reflect a broader effort to adapt to evolving market conditions while maintaining focus on Ethereum's long-term objectives. The October 3 transaction, therefore, represents not only a financial decision but also a strategic signal of the foundation's commitment to decentralized execution and ecosystem stewardship .