From 'A Foundation' to 'Multi-Node Governance': Is Ethereum Undergoing a Silent Power Restructuring?

Written by: imToken

In the past two weeks, Ethereum has been undergoing an unprecedented transformation at the organizational level.

• On June 22, 2026, five former core researchers of the Ethereum Foundation announced the establishment of Ethlabs, an independently operated non-profit research and development lab;
• A day later, the EF announced a new organizational structure, confirming the termination of cooperation with 54 employees—about 20% of the foundation's total staff;
• On July 1, another independent non-profit organization, Ethereum Institutional, officially launched, taking over the institutional collaboration work previously handled by the EF market expansion team;

If viewed separately, these events can easily be summarized into a familiar pessimistic narrative, namely that the foundation is facing a financial crisis, core talent is leaving, and the ecosystem is in turmoil.

Similar sentiments are indeed prevalent in the market.

However, if we place these events on the same timeline, we can see a more complete picture: Ethereum is consciously reducing its dependence on a single foundation, gradually decentralizing the various functions that were previously concentrated within the EF into multiple independent ecological nodes with different roles.

Ethereum seems to finally be attempting to answer a long-standing question: as a decentralized network gradually becomes a global infrastructure, what should the organization driving its development look like?

1. Why is EF Choosing to 'Actively Downsize'?

To be pragmatic, interpreting this series of changes within a traditional business context can easily lead most users to misunderstandings. After all, in the narrative of traditional tech companies, layoffs almost always imply revenue pressure, business contraction, or strategic failure.

But the Ethereum Foundation is not an ordinary company.

It does not have shareholders in the traditional sense, does not aim for market share or quarterly profits, and does not 'actually own' the Ethereum network. In a sense, the EF is more akin to a protocol guardian, whose main responsibilities are to support core protocol development, fund public goods, coordinate ecological resources, and uphold principles that should not be easily compromised during Ethereum's development.

This also places EF in a state of inherent tension.

On one hand, Ethereum needs long-term investment in protocol development, organizational upgrades, and public goods construction; on the other hand, if research, funding, talent, and decision-making increasingly concentrate within the foundation, then EF itself becomes the largest source of centralization risk for Ethereum.

Therefore, EF has long adhered to an organizational philosophy of 'doing subtraction.' According to EF's explanation of this concept, a healthy Ethereum ecosystem should not rely on an ever-expanding foundation but should be maintained by numerous independent organizations and contributors. Thus, the success of the foundation should ultimately manifest as a gradual decline in its relative influence, rather than infinite growth.

This line of thinking is not a spur-of-the-moment decision. In the fiscal policy announced in 2025, EF had already clearly stated its intention to gradually narrow its scope of responsibilities, planning to reduce annual operating expenses over the next five years and ultimately move towards a more long-term and sustainable foundation model.

Months ago, we also mentioned that since 2025, EF has indeed gone through a rather tumultuous period, during which EF was at the center of a public relations storm, facing a wave of community criticism, with some even calling for the introduction of a so-called 'wartime CEO' to drive change. Ultimately, a series of internal power struggles became public, forcing the highest-level power restructuring since EF's establishment:

• At the beginning of the year, Executive Director Aya Miyaguchi was promoted to President, and Vitalik Buterin committed to restructuring the leadership;
• Subsequently, Hsiao-Wei Wang and Tomasz K. Stańczak were appointed as Co-Executive Directors;
• A new marketing narrative agency, Etherealize, led by former researcher Danny Ryan, was established;
• At the same time, EF further restructured its board of directors and clarified its guiding values based on cypherpunk principles;
• By mid-year, the foundation also restructured its research department, integrating teams and making personnel adjustments to ensure that core protocol priorities were focused;

It has been proven that this combination of actions has indeed strengthened Ethereum's execution capabilities—on May 7, 2025, the Pectra upgrade was officially activated; less than seven months later, on December 3, Fusaka successfully launched on the mainnet. In the subsequent annual summary, EF referred to 2025 as one of the most productive years for the Ethereum protocol layer, with two major upgrades bringing the previously often-discussed 'accelerated hard fork rhythm' closer to reality (see further reading: "Ethereum 2026: Interpreting EF's Latest Protocol Roadmap, Officially Entering the 'Engineering Upgrade' Era?").

Therefore, from this perspective, the layoffs in June 2026 appear to be the first time this long-term strategy has been presented to the outside world in the most direct way.

After the adjustments, EF's work has been divided into five main clusters: protocol layer, access layer, user layer, community layer, and institutional layer, along with operational, management, and related support teams. EF explains that the reduction of about 20% of personnel is to concentrate the organization and resources on "only the work that EF can and must accomplish."

This is also an organization actively shrinking its own boundaries; what are some of the tasks it will hand over to others?

2. How to View Ethlabs and Ethereum Institutional?

If a metaphor must be made, my understanding is that this change superficially resembles a "division of power among three families": the talent, research, and institutional functions that were originally concentrated within EF are beginning to disperse to different organizations.

However, in terms of actual relationships, it is more akin to a functional split rather than a power struggle. That is, EF, Ethlabs, and Ethereum Institutional do not exist in a parent-subsidiary or hierarchical relationship typical of traditional corporate structures; they are more like three nodes with different roles that are interconnected within the Ethereum governance network.

First, there is Ethlabs.

Although it was announced the day before EF's layoff plan, Ethlabs was founded by five former Ethereum Foundation researchers—founding members include Ansgar Dietrichs, Barnabé Monnot, Caspar Schwarz-Schilling, Josh Rudolf, and Julian Ma, all of whom are heavyweight figures who have previously participated in research in areas such as Ethereum finality, scalability, data availability, virtual machines, and protocol economics.

However, Ethlabs clearly defines itself as an independent non-profit research and development lab serving Ethereum and ETH, with a mission that can be summed up in one sentence: "to make Ethereum the settlement layer of the global economy."

In Ethlabs' narrative, Ethereum should not just be a blockchain for issuing tokens and running applications, but should become a neutral settlement infrastructure used by digital assets, stablecoins, on-chain markets, institutions, and AI agents.

This mission creates a key distinction between Ethlabs and EF:

• EF's core task is to ensure that Ethereum does not sacrifice censorship resistance, privacy, and user sovereignty for short-term adoption and commercial interests. Its official organizational description even states that the protocol team's responsibility is not to make Ethereum easier to market or to transform it into a financial track controlled by intermediaries.
• Ethlabs, on the other hand, can discuss growth, ETH's value capture, institutional demand, and real-world adoption more explicitly;

In other words, it positions itself between two worlds. On one side are wallets, applications, Layer 2, infrastructure teams, institutions, and real users; on the other side are Ethereum's core protocols, researchers, and core developers, actively transforming the real needs of the former into protocol development, shared standards, infrastructure, and deployable products.

This also helps us better understand the positioning of Ethereum Institutional. If Ethlabs takes on the 'growth-oriented transformation of R&D' after EF steps back, then Ethereum Institutional takes on the 'commercial and compliance promotion' that EF previously handled alone.

In simple terms, this non-profit organization directly takes over the institutional collaboration work that was previously conducted by the EF market expansion team for over a year, positioning itself as the 'neutral front door' for traditional institutions entering the Ethereum ecosystem, aiming to answer a long-standing question that Ethereum has been unable to address: when a bank or asset management company wants to deploy products on Ethereum, who should they turn to?

This question has become increasingly urgent in recent years.

As is well known, ecosystems like Solana have clearer foundations, business development teams, and institutional collaboration windows, continuously making inroads into global financial institutions with high salaries and aggressive business teams. In contrast, Ethereum, due to its emphasis on decentralization and trusted neutrality, has long lacked a unified external interface.

There exists a deep-seated contradiction here, as neutrality is an advantage in technology and governance, but in the real business environment, neutrality also means "no clear responsible party." When institutions like BlackRock want to deploy on Ethereum, they hope to sit across from a team that can maintain ongoing connections, rather than a foundation that adheres to absolute neutrality and is unwilling to cater to Wall Street and sovereign funds like a traditional company.

Ethereum Institutional aims to resolve this contradiction; no one can represent Ethereum, but institutions still need a counterpart for ongoing communication.

Thus, it is incubated by Bitmine, Sharplink, and Joe Lubin, led by seasoned professionals like former BlackRock executive Joseph Chalom, which undoubtedly provides a significant advantage in directly engaging with banks, asset management companies, custodians, market infrastructure providers, fintech companies, and sovereign institutions.

According to its published information, Ethereum Institutional primarily covers five types of work, mainly helping everyone understand Ethereum, propose needs, and transform these needs into truly implementable on-chain projects:

• Institutional education and communication: helping traditional financial institutions understand Ethereum's technical architecture, governance model, and ecological status;
• Institutional market intelligence: tracking and analyzing trends, obstacles, and best practices for institutional adoption of Ethereum;
• Promotion of ETH and the Ethereum ecosystem: communicating Ethereum's value proposition to the traditional financial world;
• Industry demand and standard research: transforming actual institutional needs into standard recommendations and product requirements;
• Institutional events and relationship networks: continuously building relationships in financial centers such as New York, London, Hong Kong, and Singapore;

As a result, a clearer division of labor within Ethereum is beginning to emerge: EF is responsible for protocol value and public interest, Ethlabs is responsible for the transformation between R&D and growth, Ethereum Institutional is responsible for institutional adoption, while wallet, application, and infrastructure teams are responsible for final products and user experience.

This also means that Ethereum governance is shifting from the previously relatively vague "EF coordinates everything" to a more modular structure.

3. From 'EF Drives Ethereum' to 'The Ecosystem Jointly Safeguards Ethereum'

In the past, although Ethereum's governance structure was highly open, many key responsibilities still naturally converged on EF, which can even be summarized as the relatively vague "EF coordinates everything."

When protocol development encounters problems, people look to EF; when market narratives lag, people criticize EF; when ETH performs poorly, institutional adoption is slow, or user experience does not improve, the outside world often places the blame on EF.

This itself is a contradiction. Ethereum aspires to be a decentralized network that does not rely on any single organization, but the entire ecosystem has long been accustomed to viewing EF as the ultimate responsible party.

Now, a more modular structure is forming, where each key function has a corresponding independent organization to undertake it, and they are no longer in a hierarchical relationship but are interconnected through common protocol goals and ecological interests.

Of course, this does not mean that Ethereum has found a perfect new governance model; on the contrary, the real test is just beginning.

As different functions are decentralized to independent organizations, Ethereum will face higher coordination costs and needs to prevent different teams from acting independently, duplicating research, allowing funding sources to influence technical directions, and institutional adoption gradually overshadowing the interests of ordinary users.

But from another perspective, this uncertainty itself is also a price that must be paid for decentralization. A truly decentralized protocol should not forever rely on a continuously expanding foundation, nor should it lose the ability to continue developing simply because a few core members leave.

Whether this transformation is successful is not determined by how many people EF has left, but by:

• Whether the core protocol can continue to upgrade stably;
• Whether research talent can remain in the Ethereum ecosystem after leaving EF;
• Whether independent organizations can maintain collaboration and mutual checks and balances;
• Whether institutional adoption can expand without sacrificing openness and user sovereignty;
• Whether wallets and applications can translate underlying advancements into products that ordinary users can truly use;

If these goals can be achieved, the decline in EF's influence may actually prove that Ethereum is becoming more mature.

At that point, Ethereum will no longer be a seedling that needs constant support from the foundation but will become an ecosystem maintained collectively by the foundation, research institutions, developers, wallets, applications, enterprises, and users.

Just as Ethereum's decentralized network architecture, Ethereum's governance structure has finally become distributed in 2026.

We also firmly believe that this is not the end of a crisis, but a new starting point for a more resilient and vibrant Ethereum ecosystem.

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