Is Ethereum undergoing a silent power restructuring?

Author: imToken

Over the past two weeks, Ethereum has been undergoing an unprecedented shift at the organizational level.

• On June 22, 2026, five former Ethereum Foundation core researchers announced the establishment of Ethlabs, an independent non-profit R&D laboratory operating autonomously;

• A day later, the EF released its new organizational structure, confirming that it would end its cooperation with 54 employees—about 20% of the foundation’s total headcount;

• On July 1, another independent non-profit organization, Ethereum Institutional, officially launched and took over the institutional partnership work previously handled by the EF’s market expansion team;

If you look at these separately, they can easily be summarized into a familiar set of pessimistic narratives—namely, the foundation facing a financial crisis, core talent leaving, and the ecosystem falling into turmoil.

And the market is indeed full of similar takes.

But if you put them on the same timeline, what you actually see is a fuller picture: Ethereum is consciously reducing its reliance on a single foundation, gradually dispersing the various functions that once concentrated within the EF into multiple independent ecosystem nodes with distinct roles.

Ethereum seems to have finally started answering an old question: as a decentralized network gradually becomes global infrastructure, what should the organization that drives its development look like?

1. Why does the EF “actively get smaller”?

To be frank, interpreted in a traditional business context, this series of changes is exactly the kind of thing that can easily lead most users to misunderstand—because in the narratives of traditional tech companies, layoffs almost always imply revenue pressure, business contraction, or strategic failure.

But the Ethereum Foundation is not a typical company.

It has no shareholders in the traditional sense, does not use market share and quarterly profits as its targets, and does not “actually own” the Ethereum network. In a sense, the EF is more like a protocol guardian—its main responsibilities are to support core protocol R&D, fund public goods, coordinate ecosystem resources, and uphold those principles in Ethereum’s development that should not be easily compromised.

That also puts the EF under a constant internal tension.

On the one hand, Ethereum needs someone to invest long-term in protocol R&D, organizational upgrades, and the building of public goods; on the other hand, if R&D, funding, talent, and decision-making become increasingly concentrated inside the foundation, then the EF itself becomes Ethereum’s largest source of centralized risk.

That is why the EF has long adhered to an organizational philosophy of “doing subtraction.” According to the EF’s explanation of this idea, a healthy Ethereum ecosystem should not rely on an ever-expanding foundation; instead, it should be maintained jointly by a large number of independent organizations and contributors. Therefore, the foundation’s success should ultimately be reflected in its relative influence gradually decreasing, not in endless growth.

This thinking was not an improvised decision. In the treasury policy published in 2025, the EF has already stated clearly that it will gradually narrow its scope of responsibilities—planning to reduce annual operating expenditures over the next five years, ultimately moving toward a more long-term, more sustainable foundation model.

A few months ago, we also mentioned that since 2025, the EF indeed went through a fairly tangled period. At that time, the EF found itself at the center of a public-opinion storm, with rising waves of community criticism; some even called for the so-called “wartime CEO” to drive change. Ultimately, a series of internal power struggles became public, forcing the highest-spec power restructuring since the EF was founded:

• Early in the year, Executive Director Aya Miyaguchi was promoted to President, and Vitalik Buterin pledged to restructure the leadership;

• After that, Hsiao-Wei Wang and Tomasz K. Stańczak were appointed as Co-Executive Directors;

• Meanwhile, a new marketing-narrative institution called Etherealize—led by former researcher Danny Ryan—was established;

• At the same time, the EF further restructured its board of directors and clarified its value orientation toward cypherpunk principles;

• By mid-year, the foundation also reorganized its R&D department—integrating teams and making personnel adjustments—to ensure that core protocol priorities are kept in focus;

As it turned out, this combination of moves significantly strengthened Ethereum’s execution. On May 7, 2025, the Pectra upgrade was officially activated. Less than seven months later, on December 3, Fusaka successfully launched on the mainnet. In its subsequent annual summary, the EF described 2025 as one of the most productive years for Ethereum’s protocol layer. These two major upgrades also made the “accelerating hard fork cadence,” which had often been discussed in the past, move closer to reality.

So, from this perspective, the layoffs in June 2026 look less like an abrupt shift and more like the first time this long-term strategy is presented to the outside world in the most intuitive way.

After the adjustment, the EF’s work is divided into five main clusters: protocol layer, access layer, user layer, community layer, and institutional layer—plus operations, management, and related support teams. The EF’s explanation is that cutting about 20% of the staff is intended to concentrate the organization and resources on “work that only the EF can and must do.”

This, too, is an organization proactively shrinking its boundaries. Then, who are some of those things going to be handed over to?

2. How should we think about Ethlabs and Ethereum Institutional?

If we have to use a vivid metaphor, the author’s understanding is that on the surface, this change is a bit like “a partition of Jin”: the talent, R&D, and institutional functions that were originally concentrated within the EF are beginning to spread into different organizations.

But in terms of actual relationships, it is closer to a functional split than a power grab. That is, EF, Ethlabs, and Ethereum Institutional do not have a parent-subsidiary relationship or a superior-subordinate hierarchy like in traditional corporate structures. Instead, they are more like three nodes in Ethereum’s governance network, each with a different position, yet interconnected.

First is Ethlabs.

Although it was announced one day before the EF’s layoff plan, by five former Ethereum Foundation core researchers, the founding members include Ansgar Dietrichs, Barnabé Monnot, Caspar Schwarz-Schilling, Josh Rudolf, and Julian Ma. They are indeed heavyweight figures who, in the past, worked on research in areas such as Ethereum finality, scaling, data availability, the virtual machine, and protocol economics.

But Ethlabs defines itself clearly as an independent non-profit R&D laboratory serving Ethereum and ETH. Its mission is a single sentence: “Make Ethereum the settlement layer for the global economy.”

In Ethlabs’ narrative, Ethereum should not be only a blockchain used to issue tokens and run applications; it should become neutral settlement infrastructure used together by digital assets, stablecoins, on-chain markets, institutions, and AI agents.

This mission creates a key difference between Ethlabs and the EF:

• The EF’s core task is to ensure that Ethereum does not sacrifice censorship resistance, privacy, and user sovereignty for short-term adoption and commercial interests. Even its official organizational description explicitly states that the protocol team’s responsibilities are not to make Ethereum easier to market, nor to turn it into a financial track controlled by intermediaries.

• Ethlabs is different: it can discuss growth more explicitly, discuss ETH value capture, discuss institutional demands, and discuss real-world adoption;

In other words, it places itself between two worlds. On one side are wallets, applications, Layer 2s, infrastructure teams, institutions, and real users. On the other side are Ethereum’s core protocol, researchers, and core developers—actively translating the real needs of the former into protocol R&D, shared standards, infrastructure, and products that can actually be deployed.

This also helps us better understand Ethereum Institutional’s positioning. If Ethlabs takes on the “R&D-to-growth translation” after the EF steps back, then Ethereum Institutional is taking on the “commercial and compliance promotion” that the EF previously shouldered on its own.

Put simply, this non-profit organization directly took over more than a year of institutional partnership work that had previously been handled by the EF’s market expansion team. It positions itself as a “neutral front door” for traditional institutions entering the Ethereum ecosystem, aiming to answer a question that Ethereum has long been unable to answer: When a bank or an asset management company wants to deploy a product on Ethereum, who exactly should it contact?

This question has become increasingly urgent in recent years.

As is well known, ecosystems like Solana have clearer foundations, business development teams, and institutional partnership channels. With high-salary and highly aggressive business teams, they continue to push into global financial institutions. By contrast, Ethereum has long lacked a unified external interface because it emphasizes decentralization and credible neutrality.

Here lies a deep contradiction: neutrality is an advantage in technology and governance, but in the real-world business environment, neutrality also means “there is no clear responsible party.” When an institution like BlackRock wants to deploy on Ethereum, it expects the other side to have a team that can be continuously engaged— not a high-minded stance of absolute neutrality that refuses to adapt like a traditional company would in order to accommodate Wall Street and sovereign-fund institutions.

Ethereum Institutional is designed to resolve exactly this contradiction. No one person can represent Ethereum, but institutions still need an ongoing point of contact for communication.

So it was incubated with funding from Bitmine, Sharplink, and Joe Lubin, and led by experienced veterans such as Joseph Chalom, a former BlackRock executive. Its positioning is undoubtedly a clear advantage and will help it directly engage banks, asset management companies, custodians, market infrastructure providers, fintech firms, and sovereign institutions.

According to its published information, Ethereum Institutional mainly covers five types of work. It helps people understand Ethereum, identify needs, and convert those needs into on-chain projects that can truly be implemented:

• Institutional education and communication: helping traditional financial institutions understand Ethereum’s technical architecture, governance model, and ecosystem status;

• Institutional market intelligence: tracking and analyzing trends, obstacles, and best practices in institutional adoption of Ethereum;

• ETH and Ethereum ecosystem promotion: explaining Ethereum’s value proposition to the traditional financial world;

• Industry needs and standards research: translating institutions’ real needs into standard recommendations and product requirements;

• Institutional activities and relationship networks: continuously building relationships in financial hubs such as New York, London, Hong Kong, and Singapore;

From this, a clearer division of labor for Ethereum begins to emerge: the EF is responsible for protocol value and public interest, Ethlabs is responsible for the conversion between R&D and growth, Ethereum Institutional is responsible for institutional adoption, and wallet, application, and infrastructure teams are responsible for the final products and user experience.

This also means that Ethereum governance is shifting from the relatively ambiguous “the EF coordinates everything” of the past toward a more modular structure.

3. From “the EF drives Ethereum” to “the ecosystem jointly safeguarding Ethereum”

In the past, although Ethereum’s governance structure was highly open, many key responsibilities naturally converged on the EF, and it could even be summarized as the relatively vague “the EF coordinates everything.”

When protocol R&D encountered problems, people looked to the EF; when the market narrative fell behind, people criticized the EF; and when ETH performed poorly, institutional adoption was slow, or the user experience had not improved for a long time, the outside world would often pin the blame on the EF.

That, in itself, is a contradiction. Ethereum wants to become a decentralized network that does not rely on any single organization, yet for a long time the ecosystem has been accustomed to treating the EF as the ultimate responsible party.

Now, a more modular structure is taking shape: each key function has a corresponding independent organization to carry it. There is no superior-subordinate relationship between them; instead, they are interconnected through shared protocol goals and ecosystem interests.

Of course, this does not mean Ethereum has already found a perfect new governance model. On the contrary, the real test has only just begun.

Once different functions are distributed among independent organizations, Ethereum needs to deal with higher coordination costs. It also needs to prevent different teams from operating in silos, prevent duplicated research, prevent funders from influencing technical directions, and prevent institutional adoption from gradually overwhelming the interests of ordinary users.

But from another perspective, this uncertainty is also the cost that decentralization must pay. A truly decentralized protocol should not forever rely on an ever-expanding foundation, and it should not lose the ability to continue developing because a small number of core members leave.

Whether this transition is successful does not hinge on how many people the EF has left, but on whether:

• the core protocol can continue to upgrade in a stable manner;

• after research talent leaves the EF, it can continue to stay within the Ethereum ecosystem;

• independent organizations can maintain collaboration and mutual checks and balances;

• institutional adoption can expand without sacrificing openness and user sovereignty;

• wallets and applications can translate underlying progress into products that ordinary users can truly use;

If these goals can be achieved, the decline in the EF’s influence may instead prove that Ethereum is becoming more mature.

At that point, Ethereum will no longer be a seedling that needs to be constantly nurtured by the foundation; it will become an ecosystem jointly maintained by the foundation, research institutions, developers, wallets, applications, enterprises, and users.

Just like Ethereum’s own decentralized network architecture, in 2026 Ethereum’s governance structure has finally become distributed as well.

We have always believed that this is not the end of a crisis, but a new beginning for a more resilient and more vibrant Ethereum ecosystem.