From "A Single Foundation" to "Multi-Node Governance": Is Ethereum Undergoing a Quiet Power Restructuring?

Over the past two weeks, an unprecedented transformation has been underway within Ethereum's organizational structure.

• On June 22, 2026, five former Ethereum Foundation core researchers announced the formation of Ethlabs, an independent non-profit research and development laboratory;
• A day later, the EF unveiled a new organizational structure, confirming it would part ways with 54 employees—representing approximately 20% of the foundation's total staff;
• On July 1, another independent non-profit organization, Ethereum Institutional, officially launched, taking over the institutional partnership work previously handled by the EF's business development team;

Viewed in isolation, these events could easily be summarized in a familiar pessimistic narrative of financial crisis at the foundation, a brain drain of core talent, and ecosystem turmoil.

The market is certainly rife with such claims.

But when placed on the same timeline, a more complete picture emerges: Ethereum is consciously reducing its reliance on a single foundation, gradually dispersing the various functions previously concentrated within the EF across multiple independent ecosystem nodes with distinct roles.

Ethereum seems finally ready to tackle a perennial question: when a decentralized network gradually becomes a global infrastructure, what form should the organization driving its development take?

1. Why Is the EF "Actively Shrinking"?

To be fair, interpreting this series of changes through the lens of traditional business is indeed likely to mislead most users. 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 has no shareholders in the traditional sense, does not target market share or quarterly profits, and does not "own" the Ethereum network. In a sense, the EF is closer to a protocol guardian. Its primary responsibilities are to support core protocol research and development, fund public goods, coordinate ecosystem resources, and uphold the principles during Ethereum's development that should not be easily compromised.

This also creates an inherent tension that the EF has always faced.

On one hand, Ethereum requires long-term commitment to protocol research, upgrades, and public goods construction; on the other hand, if research, funding, talent, and decision-making become increasingly concentrated within the foundation, the EF itself becomes Ethereum's biggest centralization risk.

Therefore, the EF has long adhered to an organizational philosophy of "doing less by design." According to the EF's explanation of this philosophy, a healthy Ethereum ecosystem should not rely on an ever-expanding foundation but should be sustained by a multitude of independent organizations and contributors. Thus, the foundation's ultimate success should manifest as its relative influence gradually decreasing, not growing infinitely.

This approach is not an impromptu decision. In its treasury policy announced in 2025, the EF had already stated its intention to gradually narrow its scope of responsibilities, planning to reduce annual operating expenditures over the next five years, ultimately moving towards a more long-term and sustainable foundation model.

As we noted a few months ago, the EF experienced a particularly turbulent period since the start of 2025. At that time, the EF was at the center of a public opinion storm, facing a crescendo of community criticism. Some even called for a 'wartime CEO' to drive change. Ultimately, internal struggles became public, forcing the most significant power restructuring since the EF's inception: 

• Early in the year, Executive Director Aya Miyaguchi was promoted to President, with Vitalik Buterin committing to leadership restructuring;
• Subsequently, Hsiao-Wei Wang and Tomasz K. Stańczak were appointed as Co-Executive Directors;
• Former researcher Danny Ryan also founded Etherealize, a new marketing and narrative agency;
• Simultaneously, the EF further restructured its board of directors, clarifying its Cypherpunk value orientation;
• By mid-year, the foundation also reorganized its research department, consolidating teams and adjusting personnel to ensure focus on core protocol priorities;

These measures proved effective, significantly hardening Ethereum's execution capability—the Pectra upgrade was activated on May 7, 2025; less than seven months later, on December 3, Fusaka successfully launched on mainnet. In its subsequent annual review, the EF called 2025 one of the most productive years for the Ethereum protocol layer. These two major upgrades brought the frequently discussed goal of 'accelerating hard fork cadence' closer to reality (for more details, see: "Ethereum 2026: Decoding the Latest EF Protocol Roadmap, Entering the Era of 'Engineering Upgrades'?").

From this perspective, the layoffs in June 2026 appear as this long-term strategy being presented to the outside world in its most direct form yet.

Following the adjustment, the EF's work is divided into five main clusters: Protocol Layer, Access Layer, User Layer, Community Layer, and Institutional Layer, plus operations, management, and supporting teams. The EF explains that cutting approximately 20% of personnel is to concentrate organizational resources on "work that only the EF can and must do."

This is an organization actively defining its boundaries. Who will take over the tasks it chooses to relinquish?

2. How to View Ethlabs and Ethereum Institutional?

To use a metaphorical comparison, one could say this change superficially resembles the historical partition of a kingdom: Talent, research, and institutional functions previously concentrated within the EF are now dispersing across different organizations.

However, in terms of actual relationships, it's more akin to a functional spin-off than a power struggle. EF, Ethlabs, and Ethereum Institutional do not have parent-subsidiary or hierarchical relationships like in a traditional corporate system. Instead, they function as three distinct yet interconnected nodes within the Ethereum governance network.

First, let's look at Ethlabs.

It was announced a day before the EF's layoff plan was made public, founded by five former Ethereum Foundation researchers—Ansgar Dietrichs, Barnabé Monnot, Caspar Schwarz-Schilling, Josh Rudolf, and Julian Ma. These are indeed heavyweight figures who have previously contributed to research on Ethereum's finality, scalability, data availability, virtual machine, and protocol economics.

But Ethlabs clearly defines itself as an independent non-profit R&D lab serving Ethereum and ETH. Its mission is encapsulated in a single sentence: "Making 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 become a neutral settlement infrastructure used by digital assets, stablecoins, on-chain markets, institutions, and AI agents.

This mission dictates a key difference between Ethlabs and the EF:

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

In other words, it positions itself between two worlds. On one side are wallets, applications, Layer 2s, infrastructure teams, institutions, and real users; on the other side is Ethereum's core protocol, researchers, and core developers. Its role is to proactively translate the real needs of the former into protocol research, shared standards, infrastructure, and deployable products.

This also helps us better understand the positioning of Ethereum Institutional. If Ethlabs takes over the "translation of R&D into growth" that the EF stepped back from, then Ethereum Institutional assumes the "commercial and compliance promotion" previously shouldered by the EF.

Simply put, this non-profit directly takes over the institutional partnership work the EF's business development team carried out for over a year. It positions itself as a "neutral front door" for traditional institutions entering the Ethereum ecosystem, aiming to answer a question Ethereum has struggled with for a long time: When a bank or asset manager wants to deploy a product on Ethereum, who exactly should they contact?

This question has become increasingly urgent in recent years.

As is well known, ecosystems like Solana have clearer foundations, business development teams, and institutional partnership channels. With well-compensated and aggressive business teams, they continue to make inroads with global financial institutions. Ethereum, emphasizing decentralization and credible neutrality, has long lacked a unified external interface.

There is a deep-seated contradiction here. While neutrality is a strength technically and in governance, in a real-world business environment, being neutral also means "no clear point of contact." When an institution like BlackRock wants to deploy on Ethereum, it expects to deal with a team it can consistently engage with, not a foundation with a principled stance of absolute neutrality, reluctant to court Wall Street and sovereign wealth funds like a traditional company.

Ethereum Institutional is designed to solve precisely this contradiction. No one person can represent Ethereum, but institutions still need a consistent point of contact for communication.

Therefore, incubated with funding from Bitmine, Sharplink, and Joe Lubin, and led by seasoned professionals like former BlackRock executive Joseph Chalom, its positioning is a clear advantage, allowing it to directly engage banks, asset managers, custodians, market infrastructure providers, fintech companies, and sovereign entities.

According to its published information, Ethereum Institutional mainly covers five areas of work, primarily helping entities understand Ethereum, articulate needs, and translate those needs into realizable on-chain projects:

• Institutional Education & Communication: Helping traditional financial institutions understand Ethereum's technical architecture, governance model, and ecosystem status;
• Institutional Market Intelligence: Tracking and analyzing trends, barriers, and best practices for institutional adoption of Ethereum;
• ETH & Ethereum Ecosystem Promotion: Articulating Ethereum's value proposition to the traditional financial world;
• Industry Needs & Standards Research: Translating institutional needs into standard proposals and product requirements;
• Institutional Activities & Relationship Networks: Continuously building relationships in financial hubs like New York, London, Hong Kong, and Singapore;

Thus, a clearer division of labor within Ethereum begins to emerge: The EF handles protocol value and public goods; Ethlabs manages the translation between R&D and growth; Ethereum Institutional focuses on institutional adoption; while wallet, application, and infrastructure teams handle the final product and user experience.

This also means Ethereum governance is shifting from the previously ambiguous "EF coordinates everything" model towards a more modular structure.

3. From "EF-Driven Ethereum" to "Ecosystem Guardian Ethereum"

In the past, while Ethereum's governance structure was highly open, many key responsibilities naturally converged on the EF. This could be summarized as the somewhat vague "EF coordinates everything."

When protocol R&D encountered problems, people looked to the EF; when the market narrative lagged, people criticized the EF; when ETH performed poorly, institutional adoption was slow, or the user experience failed to improve, the blame often fell on the EF.

This is inherently contradictory. Ethereum aspires to be a decentralized network independent of any single organization, yet the entire ecosystem has long been accustomed to viewing the EF as the ultimate responsible party.

Now, a more modular structure is taking shape. Each key function has a corresponding independent organization to handle it. The relationship between them is no longer hierarchical but interconnected through shared protocol goals and ecosystem interests.

Of course, this doesn't mean Ethereum has found a perfect new governance model. On the contrary, the real test has just begun.

When different functions are dispersed across independent organizations, Ethereum will face higher coordination costs. It must also prevent different teams from working in silos, duplicating research, allowing funders to influence technical direction, or letting institutional adoption increasingly overshadow the interests of ordinary users.

But from another perspective, this uncertainty itself is the price of decentralization. A truly decentralized protocol should not rely indefinitely on any one expanding foundation, nor should it lose the ability to continue developing just because a few core members leave.

Judging the success of this transition depends not on how many people are left at the EF, but on:

• Whether core protocol upgrades can continue stably;
• Whether research talent, after leaving the EF, remains within the Ethereum ecosystem;
• 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 progress into products usable by ordinary users;

If these goals can be achieved, the EF's declining influence might actually prove that Ethereum is maturing.

At that point, Ethereum would no longer be a sapling needing constant support from the foundation. Instead, it would become an ecosystem jointly maintained by foundations, research institutions, developers, wallets, applications, businesses, and users.

Just like the decentralized network architecture of Ethereum itself, its governance structure has finally become distributed in 2026. 

We have always believed that this is not the end of a crisis, but a new beginning for a more resilient and vibrant Ethereum ecosystem.