Layla Zulfa
The Ethereum Foundation (EF), a cornerstone organization supporting the development and growth of the Ethereum ecosystem, today announced a significant reorganization, culminating a months-long strategic review. This comprehensive restructuring sees the Foundation reduce its workforce by approximately 20%, impacting 54 colleagues, while simultaneously introducing a refined operational framework centered around five distinct functional layers. The move is a direct consequence of the recently implemented "Mandate" and "Treasury Management Policy," signaling a deliberate shift towards a more focused, resilient, and strategically aligned organization dedicated to Ethereum’s foundational principles.
Background to the Restructuring: A Maturing Ecosystem Demands Clarity
The Ethereum Foundation’s decision to reshape its structure and activities is not an isolated event but rather a strategic response to the evolving landscape of the Ethereum network and the broader blockchain industry. For years, the EF has played a crucial, often sprawling, role in nurturing Ethereum from a nascent concept to a global decentralized platform. Its mandate historically encompassed everything from core protocol research and development to ecosystem grants, community building, and educational initiatives. However, as Ethereum has matured, with a robust developer community, thriving Layer 2 solutions, and a burgeoning application ecosystem, the EF’s role required re-evaluation to avoid mission creep and ensure its resources were deployed most effectively.
The "Mandate" (detailed in a publicly accessible PDF document) serves as the philosophical bedrock for this reorganization. It articulates a clear, albeit narrow, focus for the EF: to steward the Ethereum protocol’s core values, primarily censorship resistance, open-source development, privacy, and security – collectively referred to as CROPS properties in internal discussions. This mandate emphasizes that the EF is not intended to be a general-purpose accelerator for all things Ethereum, nor a commercial entity, but rather a guardian of the protocol’s fundamental integrity and long-term vision.
Complementing this, the "Treasury Management Policy," published on June 4, 2025, provides the financial framework. This policy likely outlines stricter guidelines for resource allocation, investment strategies, and operational budgeting, aiming to insulate the EF from the inherent volatility of cryptocurrency markets. By establishing a robust financial strategy, the Foundation seeks to ensure its longevity and ability to fund critical, long-horizon research and development without being overly influenced by short-term market fluctuations or speculative trends. This proactive approach to fiscal prudence, while coinciding with a period of general market consolidation in the crypto space, is presented as a measure to guarantee sustained support for Ethereum’s core infrastructure for decades to come.
The "months-long process of reorganization" suggests a methodical approach that began well before today’s announcement. This period likely involved extensive internal reviews, strategic planning sessions, and potentially consultations with key stakeholders within the Ethereum community. The mention of "colleagues who left the EF in the past few months" indicates a phased approach to workforce adjustments, with today’s announcement representing a significant, albeit anticipated, final step in the process.
A Leaner, Layered Structure for Strategic Impact
The newly unveiled organizational structure of the Ethereum Foundation is designed to be leaner, more focused, and accountable, comprising five core operational clusters, alongside dedicated operations and management teams. Each cluster is tailored to address specific domains of work, ensuring a specialized approach to achieving the EF’s refined mandate.
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Protocol Layer: This cluster is positioned as the heart of the EF’s technical endeavor. It inherits the Foundation’s legacy responsibility for "hardening and scaling the Ethereum protocol itself." Its core objective is to ensure Ethereum consistently delivers on its promise of self-sovereignty by reinforcing censorship and capture resistance, upholding open-source principles, and guaranteeing privacy and security as non-negotiable protocol attributes. This involves meticulously shipping forks, simplifying complexity, minimizing trusted dependencies, and defending against toxic Maximal Extractable Value (MEV) and privileged order flow. Crucially, this layer also spearheads long-horizon research into areas like post-quantum security, zkEVM advancements, and Layer 1 privacy solutions, translating these into tangible protocol improvements that bolster self-sovereignty at scale. The emphasis here is on fundamental integrity over short-term marketability, ensuring Ethereum remains a robust, uncorruptible base layer.
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Access Layer: Focused on the practical realization of self-sovereignty for individuals, the Access Layer aims to make Ethereum’s CROPS properties "available, legible, and survivable." This means enabling users to confidently and securely perform key actions: reading the blockchain, transacting, proving ownership, delegating authority, and exiting the system without relying on untrustworthy intermediaries. A core principle for this cluster is the "zero option," stipulating that for every intermediated path to interact with Ethereum, a credible, intermediary-free alternative must exist and remain accessible. This could involve supporting the development of better light clients, private transaction mechanisms, and user-controlled intent systems, empowering individuals to maintain custody of their digital lives from "silicon to frontend."
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User Layer: While not a product development arm, the User Layer ensures the EF’s technical work remains grounded in the real-world needs of users and organizations. This cluster focuses on understanding user segments, developing personas, creating educational materials, conducting use-case research, and evaluating the impact of protocol and access layer decisions. By keeping a finger on the pulse of actual user experiences and constraints, this layer acts as a crucial feedback loop, ensuring that technical advancements genuinely enhance self-sovereignty and address critical failure modes, rather than pursuing abstract technical purity at the expense of usability or practical resilience.
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Community Layer: This cluster manages the EF’s external presence and engagement, both within and beyond the immediate Ethereum ecosystem. Its mandate is to clearly articulate what the EF stands for, distinguishing its mission from purely financial crypto ventures, corporate-compromised projects, or grant-managing non-profits that might be susceptible to external influences. The Community Layer is responsible for cultivating relationships with natural allies in adjacent fields such as free and open-source software, secure hardware development, privacy advocacy, civil liberties organizations, and public-interest technology. This strategic outreach aims to foster fruitful collaborations that reinforce Ethereum’s commitment to open, decentralized, and self-sovereign principles.
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Institutional Layer: Recognizing the increasing interest from traditional entities, this cluster is dedicated to working with institutions that shape intermediated paths for end-users to interact with Ethereum. This includes financial institutions, non-financial enterprises (e.g., manufacturing, social, publishing), governments, universities, and other non-profit groups. The goal is not to compromise on self-sovereignty but to create "showcases of effective integration" where cryptographic technologies maximize CROPS properties and user guarantees—such as fair execution, data portability, privacy protection, and misbehavior detection. This layer also engages with academics and advocacy organizations to ensure a correct understanding of Ethereum’s potential and to track and respond to policy and regulatory developments that could impact its core principles.
Workforce Reduction and Transition Support
The most immediate and impactful consequence of this reorganization is the departure of 54 colleagues, representing approximately 20% of the Ethereum Foundation’s total workforce. This decision, described as "hard but necessary," underscores the Foundation’s commitment to aligning its operational capacity with its refined strategic focus. EF leadership asserts that these adjustments are crucial to ensure the organization is "resourced and organized in a way that allows us to focus on the critical work that only EF can, and therefore must, do in the coming years, without excessive disruption from short-term market movements."
To support the transitioning employees, the EF has put together a comprehensive package. This includes severance pay, calculated as the higher of one month’s salary per year worked at the EF or the amount legally mandated by the individual’s local jurisdiction. This severance structure mirrors that offered to employees affected by previous workforce adjustments, indicating a consistent approach to personnel transitions. Beyond financial compensation, the Foundation is also providing "transition support," which encompasses assistance in finding new roles within the broader Ethereum ecosystem and a small transition grant. This grant is specifically earmarked to cover individual transition expenses, such as career coaching, professional development, or other costs associated with seeking new opportunities.
The Foundation expressed profound gratitude to the departing individuals, acknowledging their "talent, dedication, and time they have contributed to Ethereum at the EF." There is an expressed hope that many of these skilled individuals will continue to contribute to the Ethereum ecosystem from outside the Foundation, enriching the wider community with their expertise.
Implications for Ethereum and the Wider Ecosystem
This significant reorganization by the Ethereum Foundation carries several key implications for the future trajectory of Ethereum and its surrounding ecosystem.
Firstly, it solidifies the EF’s role as a strategic steward and fundamental research facilitator, rather than a broad-spectrum funder or primary developer for all aspects of the ecosystem. This narrower focus means that other entities—Layer 2 teams, application developers, infrastructure providers, and independent research groups—will increasingly bear the responsibility for specific development and growth initiatives. This could foster greater decentralization of development efforts, aligning with Ethereum’s core ethos.
Secondly, the explicit articulation of the "Mandate" and the detailed functional layers provides unprecedented clarity on the EF’s priorities. This transparency can guide external projects and researchers seeking to align with the Foundation’s long-term vision, potentially leading to more cohesive and impactful contributions across the ecosystem. Projects that align with hardening the protocol, enhancing self-sovereignty, or broadening access to intermediary-free paths are likely to find a more receptive audience, even if direct funding mechanisms evolve.
Thirdly, the financial prudence demonstrated by the "Treasury Management Policy" and the associated workforce reduction signals a commitment to long-term sustainability. By streamlining operations and securing its financial runway, the EF aims to be a stable anchor for Ethereum’s core development, irrespective of market cycles. This institutional maturity is crucial for a project of Ethereum’s scale and importance.
While the reduction in workforce is undoubtedly challenging for those affected, the Foundation’s provision of severance and transition support aims to mitigate immediate hardship and facilitate their continued engagement within the vibrant Ethereum community. Many highly skilled individuals may now bring their expertise directly to other projects, potentially sparking new innovations and strengthening various corners of the ecosystem.
Looking ahead, the Ethereum Foundation has indicated that "more in the coming weeks and months" will be shared regarding how its work is changing and how the ecosystem can best engage with the new structure. This ongoing communication will be vital for maintaining transparency and ensuring a smooth transition for all stakeholders. The restructured EF emerges as a more focused, resilient, and strategically aligned entity, poised to continue its critical role in safeguarding and advancing the foundational promise of a self-sovereign, decentralized internet.
