Ethereum Foundation Restructures, Authority Shifts to Multiple Governance Nodes

Over the past two weeks, Ethereum has undergone an unprecedented transformation at the organizational level.

• On June 22, 2026, five former core researchers from the Ethereum Foundation announced the formation of Ethlabs, an independently operated nonprofit research and development laboratory;
• One day later, EF announced a new organizational structure, confirming the termination of employment with 54 staff members—approximately 20% of the foundation’s total workforce;
• On July 1, another independent nonprofit organization, Ethereum Institutional, officially launched, assuming responsibility for institutional partnerships previously managed by the EF market expansion team.

Individually, these events are easily summarized as a familiar pessimistic narrative: the foundation faces a financial crisis, key talent departs, and the ecosystem falls into turmoil.

The market is indeed filled with similar arguments.

But if we place them on the same timeline, we can see a more complete picture: Ethereum is consciously reducing its reliance on a single foundation, gradually decentralizing functions that were previously concentrated within the EF to multiple independent, specialized nodes within the ecosystem.

Ethereum seems to finally be attempting to answer a long-standing question: When a decentralized network gradually becomes global infrastructure, what should the organization driving it look like?

To be honest, when interpreted within a traditional business context, this series of changes is likely to mislead the vast majority of users, as in the narrative of traditional tech companies, layoffs almost always imply financial 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 aim for market share or quarterly profits, and does not “own” the Ethereum network in any literal way. In essence, the EF functions more like a protocol guardian, primarily responsible for supporting core protocol development, funding public goods, coordinating ecosystem resources, and upholding the principles that should not be easily compromised throughout Ethereum’s evolution.

This also leaves EF in a constant state of internal tension.

On one hand, Ethereum requires sustained investment in protocol development, organizational upgrades, and public goods construction; on the other hand, if development, funding, talent, and decision-making increasingly concentrate within the Foundation itself, the EF could become Ethereum’s largest centralized risk.

Therefore, EF has long adhered to an organizational philosophy of “doing less.” According to EF’s interpretation of this principle, a healthy Ethereum ecosystem should not rely on a continuously expanding foundation, but rather be sustained by a large number of independent organizations and contributors. Thus, the foundation’s success should ultimately be measured by its diminishing relative influence, not by infinite growth.

This approach is not impulsive. In the treasury policy announced in 2025, the EF explicitly stated its intention to gradually narrow its scope of responsibilities, aiming to reduce annual operating expenses over the next five years and ultimately transition toward a more long-term, sustainable foundation model.

Several months ago, we also mentioned that since 2025, EF has indeed gone through a particularly turbulent period, during which it found itself at the center of public scrutiny, facing widespread community criticism and even calls for the introduction of a so-called "wartime CEO" to drive change. Ultimately, a series of internal struggles came to light, forcing the most significant power restructuring in EF's history:

• At the beginning of the year, Executive Director Aya Miyaguchi was promoted to President, and Vitalik Buterin pledged to restructure the leadership;
• Subsequently, Hsiao-Wei Wang and Tomasz K. Stańczak were appointed as Co-Executive Directors;
• Etherealize, a new marketing narrative agency led by former researcher Danny Ryan, has been established;
• At the same time, EF further restructured its board and clarified its orientation toward cypherpunk values;
• By mid-year, the foundation restructured its research and development department, consolidated teams, and made personnel adjustments to ensure focus on core protocol priorities;

The implementation of this series of measures has significantly strengthened Ethereum’s execution capabilities—on May 7, 2025, the Pectra upgrade was officially activated; less than seven months later, on December 3, Fusaka successfully launched on mainnet. In its subsequent annual review, the Ethereum Foundation labeled 2025 as one of the most productive years for Ethereum’s protocol layer, with these two major upgrades bringing the long-discussed goal of accelerating hard fork cadence closer to reality (see further reading: “Ethereum 2026: Decoding the EF’s Latest Protocol Roadmap—Entering the Era of ‘Engineered Upgrades’?”).

Therefore, from this perspective, the layoffs in June 2026 appear more like the first time this long-term strategy was visibly revealed to the outside world.

After the adjustment, EF’s work has been organized into five main clusters: the protocol layer, access layer, user layer, community layer, and institutional layer, along with operations, management, and supporting teams. EF explained that reducing its workforce by approximately 20% aims to focus the organization and its resources on “only the work that EF can and must do.”

This is also an organization actively narrowing its boundaries—so who will take over some of these tasks?

If an analogy must be drawn, the author’s understanding is that this change superficially resembles the “Division of Jin among Three Families”: the talent, development, and institutional functions previously concentrated within EF are now dispersing into different organizations.

In practical terms, it is more akin to a functional division than a power split—that is, EF, Ethlabs, and Ethereum Institutional do not have a parent-subsidiary or hierarchical relationship as in a traditional corporate structure, but rather function as three distinct yet interconnected nodes within the Ethereum governance network.

First is Ethlabs.

Although it was announced the day before EF revealed its layoff plan, five former Ethereum Foundation researchers founded the group—founding members include Ansgar Dietrichs, Barnabé Monnot, Caspar Schwarz-Schilling, Josh Rudolf, and Julian Ma, all of whom are prominent figures previously involved in research on Ethereum finality, scalability, data availability, virtual machines, and protocol economics.

However, Ethlabs explicitly defines itself as an independent, nonprofit research and development lab serving Ethereum and ETH, with a mission stated in a single sentence: “To make Ethereum the settlement layer of the global economy.”

In Ethlabs' narrative, Ethereum should not merely be a blockchain for issuing tokens and running applications, but rather a neutral settlement infrastructure used jointly by digital assets, stablecoins, on-chain markets, institutions, and AI agents.

This mission defines a key distinction between Ethlabs and the EF:

• EF's core mission is to ensure that Ethereum does not sacrifice censorship resistance, privacy, and user sovereignty for short-term adoption or commercial gain. Its official organizational statement explicitly states that the protocol team’s responsibility is not to make Ethereum more marketable or to transform it into a financial system controlled by intermediaries.
• Ethlabs, on the other hand, can more clearly discuss growth, ETH's value capture, institutional demand, and real-world adoption;

In other words, it positions itself between two worlds: on one side are wallets, applications, Layer 2 solutions, infrastructure teams, institutions, and real users; on the other side are Ethereum’s core protocol, researchers, and core developers, actively translating the real-world needs of the former into protocol research, shared standards, infrastructure, and deployable products.

This also helps us better understand Ethereum Institutional’s positioning: if Ethlabs takes over EF’s former role of “researching growth-oriented conversions,” then Ethereum Institutional takes over EF’s original responsibility of “commercial and compliance outreach.”

In short, this nonprofit organization has taken over the institutional partnership work that the EF market expansion team had been conducting for over a year, positioning itself as the “neutral front door” for traditional institutions entering the Ethereum ecosystem, aiming to answer a question Ethereum has long failed to address: When a bank or asset management company wants to deploy a product on Ethereum, who should they contact?

This issue has become increasingly urgent over the past few years.

It is well known that ecosystems like Solana have more defined foundations, business development teams, and institutional partnership channels, leveraging high-salary and highly aggressive business teams to continuously expand their presence among global financial institutions. In contrast, Ethereum, due to its emphasis on decentralization and trusted neutrality, has long lacked a unified external interface.

There is a deeper contradiction here, because neutrality is an advantage in technology and governance, but in the real business environment, neutrality also means "no clear point of contact." When an institution like BlackRock wants to deploy on Ethereum, it seeks a team it can consistently engage with—not a foundation that upholds an absolute stance of neutrality and refuses to engage with Wall Street and sovereign funds the way traditional companies do.

Ethereum Institutional addresses exactly this contradiction: no one can represent Ethereum, yet institutions still need a consistent point of contact.

Thus, backed by Bitmine, Sharplink, and Joe Lubin, and led by seasoned professionals such as former Blackstone executive Joseph Chalom, this positioning will undoubtedly be a significant advantage in directly serving banks, asset managers, custodians, market infrastructure providers, fintech companies, and sovereign institutions.

According to its published information, Ethereum Institutional primarily focuses on five areas, mainly helping people understand Ethereum, articulate needs, and transform those needs into tangible on-chain projects:

• Institutional Education and Communication: Help traditional financial institutions understand Ethereum’s technical architecture, governance model, and ecosystem status;
• Institutional Market Intelligence: Track and analyze trends, barriers, and best practices in institutional adoption of Ethereum;
• ETH and Ethereum ecosystem promotion: Communicating Ethereum's value proposition to the traditional finance world;
• Industry Needs and Standards Research: Translate actual institutional needs into standard recommendations and product requirements;
• Institutional activities and network: Continuously building relationships in financial hubs such as New York, London, Hong Kong, and Singapore;

As a result, a clearer division of labor within the Ethereum ecosystem is emerging: EF is responsible for protocol value and public good, Ethlabs for translating research into growth, Ethereum Institutional for institutional adoption, and wallet, application, and infrastructure teams for final products and user experience.

This also means that Ethereum governance is shifting from the previously somewhat ambiguous "EF coordinates everything" model toward a more modular structure.

In the past, although Ethereum's governance structure was highly open, many key responsibilities naturally converged on the EF, often summarized as the somewhat vague "EF coordinates everything."

When protocol development encounters issues, people turn to the EF; when market narratives lag, people criticize the EF; when ETH underperforms, institutional adoption is slow, or user experience fails to improve, outsiders often blame the EF.

This is inherently contradictory. Ethereum aims to be a decentralized network independent of any single organization, yet the entire ecosystem has long treated the EF as the ultimate authority.

Now, a more modular structure is emerging, with each key function handled by a separate, independent organization, connected not by hierarchical relationships but by shared protocol goals and ecosystem interests.

Of course, this doesn't mean Ethereum has found a perfect new governance model—in fact, the real test has only just begun.

When different functions are distributed across independent organizations, Ethereum faces higher coordination costs and must prevent teams from operating in silos, duplicating research, allowing funders to influence technical direction, and institutional adoption gradually overriding the interests of ordinary users.

But from another perspective, this uncertainty is also a necessary cost of decentralization. A truly decentralized protocol should not rely indefinitely on a single, ever-expanding foundation, nor should it lose its ability to progress simply because a few core members depart.

The key to determining whether this transition has been successful is not how many people remain at EF, but:

• Can the core protocol continue to be upgraded stably?
• Whether research talent leaving EF can continue to remain in the Ethereum ecosystem;
• Can independent organizations maintain collaboration and mutual checks and balances?
• Can institutional adoption scale without compromising openness and user sovereignty?
• Can wallets and applications translate underlying advancements into products that ordinary users can actually use?

If these goals are achieved, the decline in EF's influence may instead demonstrate that Ethereum is becoming more mature.

At that point, Ethereum will no longer be a sapling requiring constant support from the Foundation, but rather an ecosystem sustained by the Foundation, research institutions, developers, wallets, applications, businesses, and users.

Just like Ethereum's own decentralized network architecture, Ethereum's governance structure also became distributed in 2026.

We also firmly believe that this is not the end of a crisis, but a new beginning for a more resilient and vibrant Ethereum ecosystem.