Key Highlights
- The Ethereum Foundation is cutting its 2026 budget by 40%.
- Annual spending targets may fall from 15% pre-2026 to around 5% after 2030.
- EF will prioritize core upgrades tied to the Ethereum Strawmap initiative.
The Ethereum Foundation (EF) is implementing a 40% budget reduction this year as it transitions toward a more sustainable, endowment-based model, according to Ethereum co-founder Vitalik Buterin.
In a detailed X post on Tuesday, Buterin stated that the EF aims to move from its pre-2026 average of spending roughly 15% of its funds annually toward a post-2030 target of around 5% per year. This endowment-style model is designed to ensure the organization’s longevity and reduce vulnerability to short-term market volatility.
He acknowledged the human cost of these changes. He praised departing colleagues as “brilliant people” and “dedicated engineers,” some of whom have contributed to the Ethereum protocol for nearly a decade.
“I will not try to pretend that there was not much that is lost,” he wrote, while expressing hope that many will continue contributing within the Ethereum ecosystem or the broader “CROPS world.”
What are the operational shifts
A key focus of the restructuring is the Ethereum Strawmap, which Buterin described as a major initiative comparable in scope to Ethereum’s third major phase following the Merge.
The project seeks to overhaul key areas, including consensus, proofs, privacy, the account model, and state. The foundation is also expanding its role in building the “access layer” to improve usability and real-world applicability.
To support these objectives with fewer resources, several operational shifts are underway:
- The multi-client model will evolve from pure redundancy toward greater specialization, supported by increased use of AI-assisted formal verification for protocol components.
- The Privacy and Scaling Explorations (PSE) team is winding down as a dedicated unit, with ZKP work shifting from exploration to direct implementation in the protocol and access layer.
- Devcon events will become smaller-scale, more cost-efficient, and aligned with the new mandate.
- The EF will pursue fewer large-scale “megaprojects,” with Vitalik personally funding some initiatives he considers valuable.
- Institutional efforts will narrow to creating replicable, highly CROPS-friendly deployment examples.
Vitalik outlines long-term vision
Commenting on the changes, Ethereum community infrastructure builder YQ described the decision as a return to a leaner operating model similar to the foundation’s early years.
According to YQ, priorities such as security, post-quantum cryptography, and privacy will remain central, while more experimental initiatives may increasingly be pursued by other ecosystem participants.
Vitalik outlined a long-term “soft lean-and-done” philosophy for Ethereum: once the Strawmap is complete, the protocol should focus primarily on security fixes and high-value improvements, adopting a higher bar for new features. He drew inspiration from Bitcoin’s more conservative approach rather than large, complex codebases.
Restructuring follows workforce reduction
The budget changes follow the recent departure of 54 Ethereum Foundation employees as part of a broader organizational restructuring.
Affected employees received severance packages and transition support. While some responsibilities may shift to other organizations within the Ethereum ecosystem, Buterin noted that not all functions will necessarily be replaced externally.
The restructuring reflects the foundation’s broader effort to align spending, staffing, and development priorities with its long-term roadmap and sustainability goals.
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