Ethereum Foundation Plans 40% Budget Cut, 20% Staff Reduction
The Ethereum Foundation is moving into a new phase of belt-tightening. CoinDesk reported that the organization will cut its budget by about 40% this year and shift to a leaner, "endowment-style" operating model.
Cofounder Vitalik Buterin said the long-term goal is to bring annual spending down to roughly 5% of treasury assets after 2030. In a blog post, he added that spending before 2026 is expected to run at about 15% of remaining treasury assets, with the rate declining gradually over time.
The budget update coincided with a confirmed 20% workforce reduction. The foundation also said Co-Executive Director Hsiao-Wei Wang has departed. Since January, nine senior members have left the Ethereum Foundation, underscoring continued organizational change.
Buterin acknowledged that the downsizing involved difficult choices, including the exit of senior engineers who have been deeply involved in Ethereum's development. The foundation said it intends to cut costs while continuing to fund work aligned with Ethereum's future roadmap.
Several initiatives are being scaled back in parallel. The foundation plans to gradually wind down its Privacy and Scaling Explorations (PSE) department, reduce institutional partnership efforts, and make Devcon smaller and more cost-effective.
On the technical side, the foundation expects to shift more work to specialized client teams and introduce AI-assisted formal verification to lower certain development and auditing costs.
Looking beyond the current roadmap, Buterin reiterated his preference for Ethereum to move into a "streamlined and stable" phase. Protocol development would then prioritize security patches and a limited number of high-impact upgrades, rather than continuously adding new features.
For markets, the combined budget contraction and leadership turnover point to a reallocation of resources and a push to reduce nonessential spending. The foundation disclosed the budget adjustment and layoffs on the same day; Wang's departure brings total senior exits since January to nine.
