The Ethereum Foundation is cutting 54 employees (20% of staff) and slashing its budget by 40% in a major restructuring. Co-founder Vitalik Buterin said the move is part of a transition to a leaner, endowment-based model, aiming to reduce annual spending from 15% to 5% of its treasury by 2030. The overhaul, which follows numerous senior leadership departures, reorganizes work into five clusters and winds down its PSE research unit.
Workforce reduction
- ▪The Ethereum Foundation laid off 54 employees, representing approximately 20% of its workforce
- ▪The staff reduction concludes a months-long reorganization process tied to the Foundation's new "Mandate" and "Treasury Management Policy."
- ▪Ethereum co-founder Vitalik Buterin acknowledged the loss, stating he would not pretend "that nothing of great value was lost."
- ▪The layoffs follow the departure of at least nine senior figures since January, including co-executive directors Hsiao-Wei Wang and Tomasz Stańczak
Endowment transition strategy
- ▪The Ethereum Foundation is reducing its annual budget by approximately 40% as part of the restructuring
- ▪Vitalik Buterin stated he favors a long-term "soft lean-and-done" approach for Ethereum, learning from Bitcoin's conservative development model
- ▪The Foundation is transitioning to a long-term, endowment-based model, aiming to cut annual spending from ~15% of its treasury to ~5% by 2030
- ▪The price of Ethereum (ETH) fell almost 7% on the news of the reorganization
Client development model changes
- ▪The EF plans to shift its multi-client model, expecting teams to focus on specialized needs rather than redundancy, potentially using AI-assisted formal verification for security
- ▪The Foundation's remaining work will be organized into five new clusters: protocol, access, user, community, and institutional layers
- ▪The protocol cluster will focus on making Ethereum more resistant to censorship and capture, and on long-term research like post-quantum security
Protocol technical roadmap
- ▪Vitalik Buterin described the current technical roadmap as Ethereum's "third major iteration," aiming to improve nearly every major component of the protocol
- ▪The Foundation's new direction will be anchored by the CROPS framework: censorship resistance, capture resistance, openness, privacy, and security
Institutional adoption focus
- ▪A new independent nonprofit research lab, Ethlabs, was launched by five former Ethereum Foundation researchers
- ▪Ethlabs is backed by Ethereum co-founder Joe Lubin and firms like BitMine Immersion Technologies and Sharplink
- ▪The EF's institutional work will narrow to focus on projects that demonstrate how institutions can use Ethereum without compromising its core principles
Privacy Scaling Explorations shutdown
- ▪Devcon, the Ethereum Foundation's flagship developer conference, is expected to become smaller, more austere, and less expensive to operate
- ▪The Privacy and Scaling Explorations (PSE) unit, an incubator for ZK-proofs and scaling research, will be wound down as a standalone group
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