This week’s edition of The Protocol Newsletter explores the recent transformations at the Ethereum Foundation throughout this year.
By Margaux Nijkerk|Edited by Cheyenne Ligon Jul 15, 2026, 1:19 p.m. 2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShowWelcome to The Protocol, CoinDesk’s tech newsletter that covers crucial developments in blockchain. I’m Margaux Nijkerk, a reporter at CoinDesk.
We aim to provide you with insights into the significant trends, innovations, and discussions shaping the blockchain landscape weekly.
This week, we are examining the timeline of transformations within the Ethereum Foundation since the start of the year.
Entering 2026, the Ethereum Foundation faced increasing scrutiny. Developers, investors, and key members of the Ethereum community had been vocal about their concerns regarding the foundation's execution pace, governance, and technical focuses, with many claiming that the Ethereum roadmap was too heavily concentrated on layer-2 scaling, thereby sidelining improvements to the base layer.
The first significant change occurred in February when co-executive director Tomasz Stańczak announced his resignation following his role in guiding the foundation through its initial restructuring. Shortly after, the foundation released a new mandate that clarified a more focused vision of its role within the Ethereum ecosystem. This new direction, based on the CROPS framework—censorship resistance, resilience, openness, privacy, and security—redefined the foundation as a long-term steward rather than the main builder or coordinator of the ecosystem.
The leadership shift led to a wave of exits. In the following months, nine senior leaders, researchers, and executives departed from the organization, marking one of the highest turnover rates in its 12-year existence. These departures sparked speculation about the foundation's future, despite leadership asserting that these changes were not indicative of decline but rather an essential element of a broader organizational reset.
This reset gained momentum in June. Co-executive director Hsiao-Wei Wang resigned, followed by the foundation's announcement of its most extensive restructuring to date. It reduced its workforce by approximately 20%, laying off 54 employees, and slashed its annual operating budget by about 40% to enhance financial sustainability. The remaining employees were reorganized into five key operational groups focusing on areas where the foundation claimed it was uniquely equipped to provide support.
The June restructuring coincided with the formation of new entities aimed at taking over responsibilities that had traditionally rested with the foundation. ETHLabs, a newly established organization supported by several major ETH treasury firms, launched to expedite protocol research, ecosystem coordination, and product development independent of the foundation. In July, Ethereum Institutional was introduced—another initiative focused on aiding enterprises, asset managers, and nonprofits in adopting Ethereum through research, education, and standards development. Shortly thereafter, yet another organization emerged with its own objectives. EthSystems has positioned itself as a for-profit entity aimed at developing infrastructure to maintain transaction confidentiality for financial institutions utilizing Ethereum.
Collectively, these developments in 2026 represent the most substantial reorganization in the Ethereum Foundation's history. What started with community criticism regarding governance and technical priorities culminated in a smaller foundation, fresh leadership, a redefined mandate, and an ecosystem increasingly dependent on independent organizations to advance research, institutional engagement, and protocol development.
Read more: Ethereum's newest nonprofit wants to become Wall Street's guide to crypto
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Why it matters:
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