Ethereum Foundation reorganises and lays off 20% of staff

The Ethereum Foundation (EF) has completed a major reorganisation. Around 54 employees are leaving the organisation, amounting to approximately 20% of the total workforce. At the same time, co-founder Vitalik Buterin has announced that the budget for 2026 will be cut by roughly 40%. The price of Ethereum has reacted negatively and stands at $1.6K at the time of writing, a decline of 4.2% over the past 24 hours.

Ethereum is available at OKX and Bybit.

New structure with five work clusters

After a reorganisation process lasting several months, the EF has presented a completely new organisational structure. It now consists of five main clusters: protocol, access, users, community and institutional layer. In addition, an operational cluster and supporting management teams will be added. The aim is a more focused and agile organisation, as the Ethereum Foundation itself reports.

The 54 departing employees will receive severance pay and support in their transition to a new job. Notably, the EF also announced that it will narrow a number of work streams. PSE will be dissolved as an independent unit, and Devcon will be organised on a smaller scale in the future. The foundation is also reducing its institutional activities. Former EF researchers previously launched EthLabs as their own initiative.

Budget sharply reduced towards an endowment model

Vitalik Buterin explains that the EF is transitioning to a long-term endowment model. Concretely, this means that annual expenditure will be reduced from around 15% of the remaining funds for 2026 to approximately 5% after 2030. The budget for this year will already be cut by 40% compared with earlier plans.

Despite the cuts, Buterin states that the EF will continue to fully deliver on its protocol-level ambitions. The core mission, further developing the Ethereum protocol, is therefore not in question. The reorganisation comes at a time when the broader market is also under pressure: ETF flows for both Bitcoin and Ethereum were already negative on 22 June, and open interest in Ethereum previously plummeted from $3.3 billion to $1.0 billion.