The Ethereum Foundation (EF) has announced a comprehensive reorganization that includes a 40% reduction in its 2026 budget and a 20% cut to its workforce, signaling a shift toward a leaner, endowment-style operational model for the blockchain ecosystem. This transition aims to secure the foundation’s long-term financial viability for investors, developers, and stakeholders who rely on the network's stability.
The Ethereum Foundation is implementing a fiscal strategy to lower its annual operating expenditures from approximately 15% of its treasury assets to a target of 5% by the year 2030. According to The Defiant, this "glide path" was codified in the foundation’s Treasury Management Policy published in June 2025, which mandated a linear reduction in spending over a five-year period. By adopting this endowment-based approach, the organization intends to ensure that it can continue supporting the Ethereum protocol through extended market downturns without relying on frequent token sales.
The foundation has officially reduced its workforce by 20%, resulting in the departure of 54 employees. This downsizing was finalized on June 23, 2026, and follows the resignation of co-Executive Director Hsiao-Wei Wang earlier this month. As reported by CoinMarketCap Academy, this departure marks the ninth exit of a senior figure from the organization since January 2026, underscoring a significant period of internal leadership turnover.
Under the new restructuring, the foundation has reorganized its internal operations into five distinct clusters, including the protocol layer, access layer, user layer, community layer, and institutional layer. As noted by The Defiant, the Privacy and Scaling Explorations (PSE) unit is being disbanded as part of this effort, and future Devcon conferences will be smaller and less costly to operate. Furthermore, the organization is shifting toward specialized client teams that will leverage AI-assisted formal verification to maintain the network.
Ethereum co-founder Vitalik Buterin has expressed a long-term preference for a "lean-and-done" future for the protocol once its current development roadmap is finalized. Once these primary milestones are achieved, the foundation plans to shift its focus primarily toward essential security fixes and high-impact upgrades. According to KuCoin News, this strategy aims to impose higher barriers for new feature additions, effectively moving toward a more minimalist development model.
These structural changes arrive as the Ethereum ecosystem faces increased pressure to maintain its competitive standing against rival blockchain networks. Despite the significant organizational reduction, Buterin emphasized that these were difficult decisions involving the loss of experienced engineers. As reported by The Defiant, the foundation is working to ensure that some departing members may continue to support the broader Ethereum ecosystem through independent, external efforts.
