The Ethereum Foundation is undergoing a major restructuring: a 20% staff reduction and a shift to a cluster model.
The Ethereum Foundation (EF) has completed a multi-month reorganization aimed at optimizing treasury management and improving operational efficiency. As part of this transformation, the foundation reduced its workforce by 54 employees — approximately 20% of the total team size.
The new EF structure is based on five key operational clusters: Protocol Layer, Access Layer, User Layer, Community Layer, and Institutional Layer. Additionally, operations and management support units have been established. This approach is intended to replace the previous, more vague organizational structure, ensuring a clear division of responsibilities.
Laid-off employees have been offered severance packages: at least one month's salary for each year of service or the local statutory minimum, whichever is greater. The foundation is also assisting in finding new roles within the Ethereum ecosystem and providing a small grant for related expenses.
This decision is part of the implementation of the Treasury Management Mandate and Policy, which were previously adopted. The Ethereum Foundation aims to use resources more efficiently, especially given the current bear market trend and increasing competition among L1 protocols.
My analysis: A 20% workforce reduction is a significant step that may temporarily slow development pace, but in the long term, it will enhance the foundation's resilience. The cluster model is the right decision, as it reduces bureaucracy and accelerates decision-making. However, laying off 54 people from a key ecosystem organization signals that even Ethereum is not immune to the need for strict optimization amid market volatility.