Ethereum Foundation Under the Knife: Buterin Confirms 40% Budget Cut and Loss of Key Personnel
Ethereum co-founder Vitalik Buterin has officially confirmed that the Ethereum Foundation (EF) is entering a phase of austerity. The foundation's budget will be cut by approximately 40% this year. This is not just "optimization" — it is a deliberate, painful decision that has already led to the loss of several key employees.
Buterin explained that these measures are part of a long-term treasury management strategy. Previously, the EF spent about 15% of its remaining funds annually. The new goal is to reduce this figure to around ~5% per year, which will be achieved after 2030. The foundation aims for financial sustainability, independent of external pressure, and does not intend to rely on large budgets for survival.
Personnel losses and shifting priorities
Buterin did not call the process "efficiency improvement" — he respects his departing colleagues too much. He described them as "brilliant people and dedicated engineers," some of whom had worked on the Ethereum protocol for nearly a decade. This is a serious blow to the foundation's institutional memory and expertise.
Despite the cuts, ambitions for protocol development remain undiminished. The key focus becomes the Ethereum Strawmap — a comprehensive roadmap aimed at updating every component of the network: consensus, proofs, privacy, account models, and state management. Buterin calls this the third iteration of Ethereum after The Merge.
One of the major changes is a shift in the "multi-client" model. Previously, security was built on redundancy: a bug in one client would not paralyze the network. Now, the foundation is actively exploring a formal verification approach using artificial intelligence.
The Privacy and Scaling Explorations (PSE) division is being wound down as a separate unit. The Devcon conference will become more modest and less costly. The number of large-scale projects outside of Ethereum funded by the foundation will decrease. As Buterin previously announced, he will personally cover some of these initiatives using his own funds.
"Soft endgame" and lessons from Bitcoin
In the long term, Buterin advocates for an approach he calls a "soft endgame." After the Strawmap is implemented, the foundation should largely limit itself to security fixes and minor valuable changes. The bar for adding new features to the protocol should be set significantly higher.
"This will allow Ethereum to remain resistant to capture without requiring large budgets," he emphasizes. As a benchmark, Buterin suggests looking to Bitcoin rather than "bloated projects with millions of lines of code." This signals a transition to a more restrained and mature model of network development.
Analyst comment: The Ethereum Foundation is entering a phase of "maturation," moving away from a model of generous funding toward sustainability. The loss of experienced personnel is a worrying signal, but the bet on formal verification and AI could be a technological breakthrough. The market should closely monitor how these changes impact the pace of network upgrades.