Ethereum Foundation Under the Knife: Buterin Confirms 40% Budget Cut and Loss of Key Personnel
Ethereum co-founder Vitalik Buterin has officially confirmed a major restructuring of the Ethereum Foundation (EF). This year, the foundation is cutting its operational budget by approximately 40%, which has already led to an outflow of valuable employees. This is not just "cost optimization," but a fundamental shift in the organization's treasury management strategy.
Buterin explained that until 2026, the EF was spending on average about 15% of its remaining reserves annually. The new goal is to reduce this figure to roughly 5% per year, to be achieved after 2030. The foundation aims for long-term sustainability to be immune to external pressure and independent of large capital injections.
Losses and New Priorities: Human Capital on the Way Out
Vitalik did not soften the reality by calling it "efficiency improvement." He emphasized that he respects departing colleagues too much to pretend nothing is happening. He described the departing specialists as "brilliant people and dedicated engineers," many of whom have worked on the Ethereum protocol for nearly a decade.
Despite the cuts, ambitions for developing the protocol itself are not diminishing. The key focus remains the Ethereum Strawmap — a massive roadmap aimed at replacing and supplementing every element of the protocol: consensus, proofs, privacy, account model, and network state management. This is, in essence, the third iteration of Ethereum after The Merge.
One of the main changes will be abandoning the "multiple clients" strategy in favor of formal verification using AI. Previously, network security relied on redundancy: a bug in one client would not paralyze the network. Now, the foundation is betting on mathematically proven code correctness.
The Privacy and Scaling Explorations (PSE) unit is being wound down as a separate entity. 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 is taking over the personal funding of some of these initiatives.
Long-Term Vision: "Soft End" of the Innovation Era
In the long term, Buterin advocates for an approach he called a "soft end." After the Strawmap roadmap 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 significantly raised. This approach will allow Ethereum to remain resistant to capture without requiring large budgets. As a benchmark, Buterin suggested looking to Bitcoin as an example, rather than "bloated projects with millions of lines of code," thereby signaling a transition to a more restrained model of network development.
Cryptalist Analysis: Buterin's decision is not just crisis management, but a deliberate step towards "tempering" Ethereum. By cutting the "fat" and focusing on the protocol's core, the EF is preparing for the long game. The departure of talented engineers is a painful but inevitable price for transitioning from an expansion phase to a phase of stabilization and maturity. Now, the market will closely watch whether this cost-cutting becomes a brake on innovation, which has always been Ethereum's hallmark.