The Ethereum Foundation (EF) has finalized a comprehensive months-long reorganization, ushering in a new operational structure and a reduced workforce. This strategic shift, driven by the implementation of the EF’s Mandate and its Treasury Management Policy, aims to enhance execution capabilities on critical development and research fronts for the Ethereum protocol. The restructuring has resulted in the departure of 54 colleagues, approximately 20% of the foundation’s staff, who are expected to continue contributing to the Ethereum ecosystem in various capacities.
A New Era for the Ethereum Foundation: Strategic Realignment and Focus
This pivotal reorganization marks a new chapter for the Ethereum Foundation, an organization central to the development and advancement of the world’s second-largest cryptocurrency by market capitalization. The Ethereum network, a decentralized platform enabling smart contracts and decentralized applications (dApps), has grown exponentially since its inception in 2015. The EF has historically played a crucial role in funding research, development, and ecosystem growth, supporting a vast array of projects and initiatives.
The impetus for this restructuring stems from the recently formalized EF Mandate and a new Treasury Management Policy. These documents outline a clearer strategic direction and a more disciplined approach to resource allocation. The EF has articulated that the reorganized structure is designed to equip the foundation with the necessary personnel, activities, and organizational framework to effectively address the complex challenges and opportunities facing Ethereum in the coming years. This includes a sharpened focus on core protocol development, scaling solutions, and ensuring the long-term sustainability and security of the network.
The Reimagined EF Structure: Seven Pillars of Ethereum’s Future
The newly adopted structure for the Ethereum Foundation is built around seven distinct clusters, each tasked with specific domains of work crucial to the ecosystem’s continued evolution. This approach acknowledges the multifaceted nature of Ethereum’s development and aims to create specialized teams capable of addressing distinct challenges with tailored strategies.
The five core clusters focused on specific areas of Ethereum’s growth are:
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Protocol Layer: This cluster inherits the EF’s foundational responsibility for the core Ethereum protocol. Its primary objective is to ensure Ethereum upholds its core promises of scaling, self-sovereignty, censorship resistance, and capture resistance. The work here is focused on hardening and scaling the protocol itself, reducing complexity, minimizing trusted dependencies, and defending against threats like toxic MEV (Maximal Extractable Value) and privileged order flow. Long-horizon research, including post-quantum security, zkEVM (Zero-Knowledge Ethereum Virtual Machine) advancements, and Layer 1 privacy solutions, will be translated into protocol changes that preserve and enhance self-sovereignty at scale. This cluster explicitly states its mission is not to make Ethereum more marketable or focused on short-term interests, but to fortify its fundamental principles against corruption and capture.
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Access Layer: This cluster addresses how Ethereum delivers on its promise of self-sovereignty in practice for individuals interacting with the network. Its mandate is to make self-sovereignty accessible, understandable, and resilient across key actions such as reading chain data, transacting, proving, delegating, and exiting. A core principle is the "zero option," meaning for every intermediated path, a credible intermediary-free alternative must exist and remain accessible. This involves identifying opportunities to enhance cryptographic properties in current infrastructure and developing credible alternatives where economic incentives might favor aggregation. The focus is on ensuring users and their agents can access and transact with the network privately, without censorship, and with guaranteed outcomes.
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User Layer: This cluster is dedicated to grounding the EF’s work in the realities of users and organizations who have a vested interest in the self-sovereign use of Ethereum. It aims to understand the most critical capabilities, the most serious failure modes, and the acceptable trade-offs for broader adoption. The work encompasses user segmentation, persona development, educational material creation, use-case research, and impact evaluation. The goal is not to transform the EF into a product studio, but to ensure that decisions made at the Protocol and Access layers are informed by the needs and constraints of real users.
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Community Layer: This cluster is responsible for shaping the EF’s public presence and engagement, both within and beyond the Ethereum ecosystem. Its objective is to clearly articulate what the EF stands for and how it differs from what it terms "zero-sum financial crypto," "corpo-compromised crypto," and certain non-profit entities vulnerable to geopolitical influence. The EF emphasizes its commitment to maximizing community value through independence from counterproductive entanglements. Furthermore, this cluster fosters relationships with allied fields such as free and open-source software, secure and local-first hardware, privacy and cryptography research, civil liberties, the decentralized web, and public-interest technology.
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Institutional Layer: This cluster focuses on the EF’s engagement with institutions that influence how end-users interact with Ethereum through intermediated paths. This includes financial institutions, non-financial enterprises, and government entities. The primary goal is to create showcases of effective integration of Ethereum and cryptographic technologies that maximize what the EF terms "CROPS properties" – censorship and capture resistance, open source, privacy, and security. The aim is to demonstrate how these technologies can benefit institutions by ensuring fair execution, data portability, practical exit strategies, enhanced privacy, authenticity, and misbehavior detection. The cluster also works with academics and advocacy organizations to ensure Ethereum is accurately understood and to monitor and respond to policy and regulatory developments.
In addition to these five domain-specific clusters, the EF has established two further clusters:
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Operations Cluster: This cluster will oversee the foundational operational aspects of the Ethereum Foundation, ensuring the smooth functioning of its internal processes and infrastructure.
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Management and Support Cluster: This cluster comprises leadership and teams directly supporting management functions, ensuring effective governance and strategic direction across the entire organization.
Each of these clusters is designed to operate with a distinct internal structure and accountability framework, tailored to the unique requirements of its respective domain. The EF has indicated that further details on the specific activities and mandates of each cluster will be shared in the coming weeks.
A Difficult Transition: Supporting Departing Colleagues
The significant reorganization has necessitated a reduction in the EF’s workforce, with 54 colleagues departing. The foundation has acknowledged the difficulty of these decisions, stating they are necessary to ensure the EF is adequately resourced and organized to execute its critical mission without undue disruption.
To support those leaving, the EF has implemented a comprehensive package that includes severance pay and transition assistance. The severance package is structured to be the higher of one month’s pay per year of service at the EF or the amount mandated by local jurisdiction, consistent with previous departures. The transition support includes assistance in finding new roles within the broader Ethereum ecosystem and a modest transition grant to cover individual expenses such as career coaching.
The EF has expressed deep gratitude for the talent, dedication, and time contributed by each departing colleague to the advancement of Ethereum during their tenure. The foundation anticipates that many of these individuals will continue to make valuable contributions to the ecosystem from their new endeavors.
Background and Chronology of the Reorganization
The process leading to this announcement has been underway for several months, signaling a deliberate and phased approach to structural change. While specific internal timelines are not publicly detailed, the announcement follows a period of strategic review and planning, culminating in the formalization of the EF’s Mandate and Treasury Management Policy.
The EF Mandate, a document outlining the foundation’s core mission and strategic objectives, provides the foundational principles guiding this reorganization. Coupled with the Treasury Management Policy, which dictates how the foundation’s financial resources are managed and allocated, these documents aim to create a more agile, focused, and impactful organization. The implementation of these policies has been a key driver behind the reshaping of the EF’s structure and operational priorities.
Industry observers have noted that such significant reorganizations within large, decentralized ecosystem foundations are not uncommon. As the Ethereum ecosystem matures and evolves, so too must the organizations that support its core development. The trend has been towards greater specialization and a more rigorous approach to resource allocation, ensuring that funding and effort are directed towards initiatives with the highest potential impact.
Implications for the Ethereum Ecosystem
This restructuring by the Ethereum Foundation carries several potential implications for the broader ecosystem:
- Increased Focus on Core Development: The emphasis on specialized clusters, particularly the Protocol Layer, suggests a renewed and intensified focus on the fundamental advancements of the Ethereum network itself. This could lead to more predictable and impactful protocol upgrades.
- Enhanced Accountability and Transparency: The clear delineation of responsibilities across the seven clusters may foster greater accountability and transparency in the EF’s operations and decision-making processes.
- Opportunities for Ecosystem Collaboration: With dedicated clusters for Community and Institutional engagement, the EF appears poised to strengthen its collaboration with external entities, potentially leading to new partnerships and broader adoption.
- Contribution from Departing Staff: The departure of 54 experienced individuals, many of whom are expected to continue contributing to Ethereum, could lead to a diversification of talent and innovation across various projects and organizations within the ecosystem. This outflow of talent can be a catalyst for growth and new ventures.
- Strategic Resource Allocation: The implementation of the Treasury Management Policy indicates a more disciplined approach to financial stewardship, which could lead to more efficient use of resources and a greater return on investment for the ecosystem.
Looking Ahead: The Future of Ethereum Development
The Ethereum Foundation has stated that the reorganized entity is leaner and more focused, positioning it to tackle the critical tasks ahead with greater efficacy. The coming weeks and months will be crucial as the EF elaborates on the specifics of its new operational strategies and how the wider ecosystem can best engage with its redefined structure.
The success of this reorganization will hinge on the EF’s ability to effectively execute its mandate within the new framework, maintain strong relationships with the community, and continue to foster innovation across all layers of the Ethereum protocol. As Ethereum continues its journey towards greater scalability, security, and decentralization, the strategic direction and operational effectiveness of the Ethereum Foundation will remain paramount. The recent restructuring signals a commitment to this ongoing evolution, aiming to ensure Ethereum’s enduring relevance and impact in the global digital landscape.
