TLDR:

• Ethereum Foundation stakes 70,000 ETH to generate yield for ecosystem operations.
• Validators use Dirk and Vouch for distributed signing and client diversity risk mitigation.
• Type 2 withdrawal credentials allow flexible balance management across validator accounts.
• EF launches a dedicated DeFi team to expand ecosystem projects and protocol research.

Ethereum Foundation Treasury Staking Initiative marks a new phase in the organization’s capital management strategy.

The Ethereum Foundation has started staking part of its treasury in line with its previously announced Treasury Policy.

On February 24, 2026, the Foundation confirmed a 2,016 ETH deposit. It also stated that about 70,000 ETH will be staked, with rewards directed back into the treasury to support ongoing operations.

Treasury Deployment and Validator Configuration

Through a post shared by the Ethereum Foundation’s official account, the organization confirmed the rollout of its Treasury Staking Initiative.

The update stated that approximately 70,000 ETH will be committed to staking. Rewards generated from validators will return to the Ethereum Foundation treasury.

The Ethereum Foundation selected open-source tools developed by Attestant. Dirk will function as a distributed signer across several geographic regions. This structure reduces single points of failure and supports validator continuity during localized disruptions.

Vouch will coordinate multiple Beacon and Execution client pairings. Its configuration strategies are designed to reduce client diversity risk. The Ethereum Foundation confirmed the use of minority clients to strengthen network resilience.

Infrastructure will combine hosted services with self-managed hardware across multiple jurisdictions. This approach distributes operational responsibility.

It also aligns with the Foundation’s stated objective of maintaining geographic and technical diversity within its validator set.

Validator Credentials and Operational Structure

The Ethereum Foundation confirmed that validators use Type 2 (0x02) withdrawal credentials. These credentials allow validator balances to move between accounts through consolidations. As a result, signing-key custody can be adjusted more efficiently.

Each validator can hold a maximum effective balance of 2,048 ETH. This configuration lowers the total number of required signing keys to about 35. Reduced key management simplifies operational oversight without changing staking exposure.

Like 0x01 credentials, exits can be triggered by the withdrawal address even if validators are offline. This setup provides additional operational flexibility. It ensures withdrawal authority remains independent from validator uptime.

The Ethereum Foundation also stated it will build blocks locally instead of using proposer-builder separation sidecars.

By participating directly in consensus through solo staking, the Ethereum Foundation earns ETH-denominated yield.

The organization confirmed that staking rewards will help fund protocol research, ecosystem development, and community grants while operating within Ethereum’s native economic framework.

Software stocks have faced notable market headwinds amid growing investor fears regarding artificial intelligence disruption.

The broader equity pullback is also raising concerns for Bitcoin (BTC), which has closely tracked software stocks.

Why Are Software Stocks Down?

According to the Global Markets Investor, the iShares Expanded Tech-Software Sector ETF (IGV) has fallen 15% in February alone, putting it on pace for its worst monthly performance since 2008. The ETF is now testing its April 2025 lows and sits roughly 35% below its peak.

“Software stocks are having their WORST month since the Great Financial Crisis,” the post read.

Artificial intelligence sits at the center of the recent drawdown, with investors selling shares of companies perceived as vulnerable to disruption by advancing AI tools. Two major developments in recent days have accelerated the downturn.

On February 20, Anthropic introduced “Claude Code Security,” a new capability embedded within Claude Code. The tool scans codebases for security vulnerabilities and recommends targeted patches for human review, aiming to detect and fix issues that traditional security tools may overlook.

The announcement triggered an immediate reaction across cybersecurity stocks. According to The Kobeissi Letter, CrowdStrike erased $20 billion in market value within two trading sessions. Furthermore, IBM shares fell more than 10%.

“The software selloff continues, w/cybersecurity stocks particularly hard hit following the release of Anthropic’s Claude Code Security due to fears that this code-focused tool will change the industry. This indicates that there is nowhere to hide when it comes to software stocks. Even the Goldman Sachs basket of supposedly AI-immune software stocks has come under heavy pressure recently,” said Holger Zschaepitz, Senior Editor at the Economic and Financial desk of the German daily Die Welt and its Sunday edition Welt am Sonntag.

Pressure intensified again on Monday after Citrini Research published a report. The report presents a hypothetical scenario set in June 2028 in which AI automation drives higher corporate profits. 

At the same time, it models significant disruption to white-collar employment, weaker consumer demand, rising credit stress, and structural economic challenges.

“What follows is a scenario, not a prediction. The sole intent of this piece is modeling a scenario that’s been relatively underexplored. Hopefully, reading this leaves you more prepared for potential left tail risks as AI makes the economy increasingly weird,” the report read.

Following the report’s release, shares of delivery, payments, and software companies moved lower. 

Rising Tech Volatility Tightens Grip on Bitcoin 

The impact is not confined to traditional equity markets. Grayscale observed that Bitcoin’s price action closely mirrored US software stocks during the latest wave of selling.

Several market participants have highlighted the correlation between US software stocks and Bitcoin. This suggests that, rather than behaving as a hedge, Bitcoin has at times traded like a high-beta extension of the tech sector.

Thus, if software stocks continue to weaken, Bitcoin may also remain under pressure. Prolonged weakness in high-growth equities can contribute to tighter financial conditions through wealth effects, higher equity risk premia, increased volatility, and systematic deleveraging across high-beta assets, including cryptocurrencies.

However, a divergence remains possible. If investors begin to view Bitcoin as a monetary hedge against structural AI-driven labor disruption, currency debasement, or policy responses such as aggressive stimulus, its correlation with software equities could weaken.

Canaan Inc. (CAN), a manufacturer of bitcoin mining hardware and an operator of crypto mining infrastructure, said it bought a 49% equity interest in a joint venture tied to several mining projects in West Texas from Cipher Mining (CIFR) for $39.75 million in stock.

The transaction covers Cipher’s stake in the ABC Projects, which include Alborz LLC, Bear LLC and Chief Mountain LLC. The rest of the venture is owned by WindHQ, according to a Monday statement.

The purchase was funded through the issuance of 806.4 million Class A ordinary shares, equivalent to 53.8 million American depositary shares, and makes Cipher, a U.S.-based bitcoin mining company that develops and operates large-scale data centers, a major shareholder in Singapore-based Canaan. The shares are subject to a six-month lock-up.

Canaan shares fell 6% on Monday, while Cipher shares rose 4%. Cipher is scheduled to report fourth-quarter earnings before the market opens on Feb. 24.

The sites collectively operate 120 megawatts of energized power capacity and support approximately 4.4 exahashes per second (EH/s) of hashrate. Fleet efficiency stands at roughly 25.7 joules per terahash (J/TH).

As part of the agreement, Canaan also purchased 6,840 Avalon A15Pro mining rigs that were previously deployed at Cipher’s Black Pearl facility, which is being converted into an AI and high-performance computing data center.

World Liberty Financial, the crypto company backed by US President Donald Trump and his sons, reported being targeted by hackers, “paid influencers” and short sellers in an effort to “manufacture chaos” against the USD1 stablecoin.

In a Monday X post, World Liberty said the attack, which happened earlier in the day, failed after hackers targeted “several WLFI cofounder accounts,” opened “massive shorts” against the company’s WLFI token, and “paid influencers to spread FUD [fear, uncertainty, and doubt].”

The price of WLFI dipped by about 7% amid the “manufactured chaos,” according to the company, but was trading at $0.1128 at the time of publication. USD1 similarly dropped to about $0.994, briefly losing its peg to the US dollar, before returning to more than $0.999.

“Thanks to USD1’s sound mint-and-redeem mechanism and full 1:1 backing, we are trading steadily at par,” said World Liberty. No scammer can shake the long-term commitment of the entire WLFI team and cofounders to USD1.”

The attack came just days after a World Liberty-organized crypto forum at Trump’s private Mar-a-Lago resort in Florida, which included speakers from the US government, crypto and banking industries, and former Binance CEO Changpeng Zhao, whom the president pardoned in October 2025. Forbes reported on Feb. 9 that Binance holds about 87% of the USD1 in circulation, worth about $4.7 billion at the time.

Related: OCC Comptroller says WLFI charter review will remain apolitical

Ties between WLFI and Binance are still under scrutiny

Some US lawmakers are questioning potential connections between World Liberty and Binance entities after Trump’s pardon of Zhao.

The former CEO had been barred from a leadership role at Binance as a result of a 2023 deal with US authorities in which he later served four months in prison, but the presidential pardon would effectively allow him to legally return. Zhao said in January that there were “no business relationships whatsoever” between himself and the Trump family, and he did not intend to return to lead Binance.

Both Bloomberg and The Wall Street Journal have reported that Binance helped create USD1. The stablecoin was also used to settle a $2 billion investment by UAE-based company MGX into Binance in March 2025, leading to conflict of interest accusations due to WLFI’s ties to the president’s family.

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