Massive subsidy cuts halt team operations? Former foundation members warn: Ethereum may face a funding shortage

Former Ethereum Foundation member warns that the core development team may face funding shortages. As grants expire and the foundation reduces expenses, the ecosystem urgently needs to establish a stable long-term funding mechanism.

Former Foundation Member Warns that Ethereum Core Development May Face Funding Gaps

Trent Van Epps, a former core coordinator who worked at the Ethereum Foundation for five years, recently posted that Ethereum’s core development ecosystem could face financial pressure within the next 3 to 9 months, sparking concern among developers and the market.

Van Epps pointed out that the issue stems from multiple factors occurring simultaneously, including the Ethereum Foundation gradually cutting back expenses, some development grant programs nearing expiration, and the ecosystem not yet having established sufficient stable long-term funding sources.

He stated that this warning does not mean the Ethereum network is about to cease operation, nor does it involve major technical issues with the protocol itself. Instead, it concerns the potential future lack of funds for teams responsible for maintaining, researching, and coordinating the underlying protocol.

Grants Ending Soon, Foundation Promotes Decentralization

Van Epps mentioned that important funding programs such as the Ethereum Client Incentive Program (CIP) are approaching their conclusion. These programs have provided ongoing financial support to client teams, researchers, and core developers over the past years, helping to maintain Ethereum’s multi-client architecture and protocol development.

On the other hand, the Ethereum Foundation has been promoting the so-called “Subtraction” strategy in recent years, aiming to reduce the Foundation’s central role in the ecosystem and encourage more enterprises, community organizations, and independent institutions to participate in funding public goods and core development work.

However, Van Epps believes that although the Foundation has begun to adjust its positioning, new funding sources and support mechanisms have not yet been fully established. As the Foundation’s expenditures decrease and existing grants expire, some teams may face funding gaps.

Maintaining Core Development Operations Requires Hundreds of Millions Annually

According to Van Epps’s estimates, currently, supporting the operation of Ethereum client teams, research organizations, protocol designers, and technical coordination mechanisms requires about $30 million per year.

This funding mainly covers engineer salaries, research activities, technical coordination, and infrastructure maintenance. Because Ethereum has long adopted a multi-client architecture, network security and protocol upgrades are distributed among different teams, necessitating ongoing resource investment to sustain overall development momentum.

Ethereum currently has multiple execution layer and consensus layer client teams, as well as numerous independent research institutions involved in protocol development. This decentralized development model helps enhance network resilience but also requires long-term, stable funding.

Leadership Changes and Funding Discussions Surface Simultaneously, Governance Topics Reemerge

As this funding warning emerged, the Ethereum Foundation has also been undergoing organizational adjustments. Including Co-CEO Wang Xiaowei, several core members have left management roles or changed positions over the past year, prompting market attention to the Foundation’s future governance structure and ecosystem coordination model.

• Related news: Wang Xiaowei resigns as Co-CEO, Ethereum Foundation’s core leadership departures raise governance concerns

Some developers believe that as Ethereum’s ecosystem continues to expand, the previous model heavily reliant on Foundation support is changing. Future core development funding may need to be jointly borne by the Foundation, Layer 2 projects, enterprises, public funding platforms, and protocol revenue sources.

Ethereum is still actively advancing Layer 2 scaling, account abstraction, data availability upgrades, and subsequent protocol updates. These development plans are not directly affected. However, how to sustain core development funding long-term and how to establish a more stable public funding mechanism for the ecosystem have become key topics of recent community discussion.

This article is compiled by Crypto Agent from various sources, reviewed and edited by “Crypto City.” It is still in the training phase and may contain logical biases or inaccuracies. Content is for reference only; do not consider it investment advice.