TL;DR

Justin Sun proposes halting ETH sales for three years, funding operations through DeFi activities like lending, staking, and stablecoin generation on platforms like Aave.
Taxes on Layer 2 projects could generate $5 billion annually for ETH buybacks and reduce its supply, strengthening its position as a deflationary asset.
A reorganization of the Ethereum Foundation would involve a drastic staff reduction, higher salaries for key employees, and an exclusive focus on Ethereum Layer 1 development. 

Tron founder Justin Sun has sparked controversy by sharing an ambitious plan to reform the Ethereum Foundation (EF) and drive the price of Ether (ETH) to $10,000. According to Sun, these measures aim to boost market confidence and align the EF’s operations with the broader Ethereum ecosystem’s interests. 

Justin Sun’s Proposal to Transform Ethereum

In a series of X posts, Sun outlined his vision for the EF, including an immediate halt to ETH sales for at least three years. To cover operational costs, he suggests leveraging DeFi platforms like Aave for lending, staking, and generating stablecoins. According to Sun, this would preserve ETH supply and strengthen its deflationary objectives.  

The plan also calls for significant taxes on Layer 2 projects, aiming to generate $5 billion annually. These funds would be used to buy back and burn ETH, further reducing its supply. To optimize efficiency, Sun proposes a drastic reduction in EF staff, rewarding the remaining employees with merit- and performance-based salary increases.  

Another key aspect of the plan is adjusting node rewards and increasing fee-burning mechanisms. These measures aim to solidify Ethereum as a deflationary asset and a long-term store of value. 

Current Context and Ethereum Foundation’s Response

The EF has faced criticism for regularly selling ETH to fund operations instead of adopting DeFi strategies. Recent data reveals that the foundation sold 4,666 ETH (roughly $13 million) in 2024. These actions have raised concerns about its alignment with the Ethereum community.  

Vitalik Buterin, Ethereum co-founder, has explained that regulatory concerns and the need to maintain neutrality have limited the EF’s ability to explore DeFi in the past. However, the EF is now testing strategies with a 50,000 ETH fund on platforms like Aave.  

Buterin also announced a restructuring within the EF to enhance communication, technical execution, and support for application developers. This shift aims to improve the adoption of decentralized technologies while maintaining a balance between neutrality and innovation. 

While Sun’s proposals are not officially endorsed by Ethereum, they have sparked a debate about maximizing the blockchain’s potential. Could this approach push ETH to $10,000? 

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Filed under: News - @ January 22, 2025 4:21 pm