Ethereum Foundation under the knife: Buterin confirms 40% budget cut and departure of key developers
Vitalik Buterin has officially confirmed that the Ethereum Foundation (EF) is entering a phase of austerity. This year, the organization's budget will be cut by approximately 40% — and this is not just "optimization," but a deliberate survival strategy embedded in last year's treasury management policy. As an experienced analyst, I see this move not as a crisis, but as a transition to a long-term endowment model designed to ensure the network's sustainability for decades to come.
Buterin explained that until 2026, the EF spent on average up to 15% of its treasury balance annually. Now, the target is being reduced to 5% per year, with the foundation planning to reach this level only after 2030. This arithmetic means the organization is consciously moving away from "fat" budgets to avoid dependence on external pressure.
Who is leaving the ship and where is Ethereum heading
The most painful aspect is the loss of personnel. Buterin did not call this "increased efficiency." He states outright: "brilliant people and dedicated engineers" are leaving, many of whom have worked on the protocol for nearly a decade. This is a serious blow to expertise, but the co-founder of Ethereum emphasizes that he respects his colleagues too much to pretend nothing is happening.
However, the cuts do not mean a halt in development. On the contrary, the key focus becomes the Ethereum Strawmap — a massive roadmap that Buterin calls the third iteration after The Merge. It covers consensus, proofs, privacy, the account model, and state management. Instead of the previous strategy of "redundancy" (where a bug in one client wouldn't bring down the network), the EF is betting on formal verification using artificial intelligence.
Some units, such as Privacy and Scaling Explorations (PSE), are being wound down as separate entities. 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 — Buterin has promised to finance some initiatives from his personal funds.
"Soft completion" and lessons from Bitcoin
In the long term, Buterin envisions Ethereum's future in a "soft completion" model. After the Strawmap is implemented, the foundation should focus only on security fixes and minor valuable changes. The bar for adding new features to the protocol must become significantly higher. As an analyst, I find it noteworthy that Buterin suggests taking Bitcoin as a benchmark, rather than "cumbersome projects with millions of lines of code." This is a signal: Ethereum is transitioning to a more restrained, conservative development model.
My expert conclusion: The 40% budget cut at the EF is not a sign of weakness, but a necessary and mature strategy. Ethereum is growing up: from generous spending on experiments to financial discipline and a focus on the protocol's core. The loss of talented engineers is a warning sign, but if the Strawmap is implemented, the network will emerge from this phase more resilient and decentralized than ever.