Ethereum Foundation Denies $12.8M ETH Sale Linked to Old ICO Wallets

Foundation denies involvement after on-chain sell-off

The Ethereum Foundation has publicly denied responsibility for a recent $12.8 million ETH sell-off that on-chain trackers tied to a wallet with roots in the 2014 ICO era. In an X post, Ethereum Foundation co-Executive Director Hsiao‑Wei Wang called the attribution incorrect, stating the transaction “was not the Ethereum Foundation’s operation.” The wallet in question moved a total of 2,975 ETH in a two-part sale that drew immediate attention from analysts and the crypto community.

Why the wallet raised suspicion

Observers flagged the wallet because it received ETH in 2017 from an address previously associated with the Foundation, suggesting an ICO-era linkage. Given the Foundation’s historical pattern of large, periodic ETH sales, the movement fit a familiar narrative that has repeatedly sparked debate about the organization’s market impact and transparency.

Foundation clarifies current holdings

Wang clarified that the specific address is no longer operated by the Foundation. She also explained that while the Foundation was originally allocated roughly 9% of Ethereum’s supply during the 2014 ICO, it has systematically reduced its stake over time. Today, Foundation‑controlled addresses hold under 0.3% of the total ETH supply, a significant reduction that signals a strategic move to minimize the Foundation’s financial footprint on the network.

Pattern of planned reductions, not ad-hoc dumps

Rather than indicating new centralized control, the Foundation’s shrinking stake appears tied to deliberate, planned transactions. The move aligns with prior activity, including a July on‑chain sale of about 10,000 ETH to SharpLink Gaming — a publicly traded company that has since become one of the larger corporate ETH holders. The Foundation has emphasized on-chain, direct sales designed to limit market disruption while trimming its ETH treasury.

Corporate treasuries rising

At the same time, a growing class of corporate ETH treasuries has been accumulating large positions. In recent months, public companies have collectively amassed an estimated $14 billion or more in ETH, concentrating a larger portion of supply in corporate hands. This shift is reshaping token distribution dynamics and triggering governance and stability conversations across the ecosystem.

Community concerns and systemic risk

Ethereum co‑founder Vitalik Buterin has warned that while corporate adoption can widen mainstream access to ETH, it also introduces systemic vulnerabilities. Buterin highlighted the danger of companies leveraging their ETH treasuries — borrowing against holdings and risking forced liquidations during downturns. Such a cascade could exacerbate volatility and undermine confidence in market stability.

Market reaction

Despite the controversy, ETH has recently rallied. According to crypto.news data, ETH traded around $4,776 at the time of reporting, up roughly 30% on the week and only about 2.35% below its all‑time high. The price resilience reflects broader bullish momentum even as debates continue about supply concentration and the long‑term implications of Foundation and corporate treasury strategies.

What this means for traders and the network

For traders, on‑chain transparency remains crucial: wallet provenance and transaction history matter when assessing potential market impact. For the Ethereum ecosystem, the Foundation’s reduction in holdings may decrease a single entity’s influence, but the rise of corporate treasuries shifts concentration elsewhere. Monitoring on‑chain flows, treasury disclosures, and corporate leverage will be essential for gauging future market risk and decentralization trends.