Ethereum Foundation Slashes Budget 40% and Axes 54 Roles
HSDT•The Ethereum Foundation slashed its budget by 40% and cut 54 roles (20% of staff), reorganizing into seven clusters focused on protocol security, censorship resistance and privacy. It plans to cap annual spending at 15% of holdings, lean on staking and DeFi yields, and pursue a 5% endowment by 2030.
1. Budget and Staffing Cuts
The Ethereum Foundation approved a 40% budget reduction and eliminated 54 positions, representing roughly 20% of its workforce. Leadership characterized the move as a strategic trade-off to prioritize long-term stability over broad initiatives.
2. Reorganization Into Seven Clusters
Staff and projects will be consolidated into seven clusters dedicated to protocol security, censorship resistance, privacy, and related core functions. This structure aims to streamline decision-making and accelerate development on critical upgrades.
3. New Funding Policy and Endowment Path
Under the June 2025 treasury policy, annual spending is capped at 15% of holdings with a 2.5-year cash buffer, targeting a 5% endowment by 2030. The foundation will rely more on staking rewards and DeFi yields rather than selling ether.
4. Community Reactions and Ecosystem Impact
Some insiders view leaner operations as a catalyst for faster protocol upgrades, while critics warn of a potential $30 million funding gap. Five former researchers have launched Ethlabs with private backing to support core development outside the foundation.
