Ethereum on the brink of a funding crisis: former EF employee sounds the alarm
The Ethereum ecosystem could face a serious funding deficit in the next 3–9 months. This forecast comes from former Ethereum Foundation (EF) employee Trent Van Epps, who worked at the foundation from May 2021 to April 2026. During this time, he coordinated protocol development, managed grants through Protocol Guild, and conducted research in network economics.
According to him, the root of the problem lies in the EF's own philosophy — the so-called "Subtraction" approach. This concept, formulated back in 2019, assumed that the foundation should not accumulate value within itself but must distribute it into the ecosystem. However, in practice, legitimacy and resources still concentrate around the EF due to its brand, direct control over communications, ties to Vitalik Buterin, and the fact that the foundation directly employs about 25% of active core protocol developers.
Two Key Pressure Factors
Van Epps highlights two main triggers for the impending crisis. First, the foundation's own policy: in June 2025, the EF announced plans to reduce annual spending from 15% to 5% by 2030. Second, in April 2026, the four-year Client Incentive Program ends, which was the primary mechanism for funding client teams through staking. No replacement for this tool currently exists.
According to the analyst's estimates, the Ethereum ecosystem requires approximately $30 million annually. This money supports over 10 client teams, research groups, and coordination structures. However, funding sources are drying up, and finding new ones is becoming increasingly difficult.
Consequences for the Network
Without a stable influx of funds, Ethereum risks losing key specialists with unique experience. This will slow down scaling and preparation for future challenges, including quantum computing. The reliability of the main network will also be at risk. Van Epps warns that within 12–18 months, the consequences will become irreversible, and correcting them will require significantly more resources.
To avoid collapse, the ecosystem needs to reconsider the social, political, and economic contracts between participants. Van Epps proposes three steps: acknowledge the interdependence of software, blockchain, and the native coin; create scalable and neutral funding mechanisms; and focus on mass adoption of the technology.
My comment: The current situation is a classic conflict between decentralization and governance efficiency. The "Subtraction" philosophy was a noble idea, but without clear funding mechanisms, it turns into a threat to the survival of the entire ecosystem. Ethereum urgently needs to find a balance between ideals and pragmatism, otherwise it risks losing its leadership.