Ethereum Foundation Announces First Public Layoffs
In response to growing external criticism regarding its unclear technical direction, low collaboration efficiency, and centralized governance, the Ethereum Foundation (EF) is undergoing a profound organizational restructuring.
R&D Team Name Change and Controversial Strategic Adjustments
On June 2, the Ethereum Foundation announced a reorganization of its research and development team, making significant structural adjustments to the internal “Protocol Research and Development Team (PR&D)” and officially renaming it to “Protocol.” This restructuring is considered not merely a simple organizational adjustment but a systematic transformation encompassing strategic goals, talent allocation, and governance concepts.
The newly formed “Protocol” team will focus on three strategic objectives: scaling the mainnet (L1), enhancing data availability (blobs), and improving user experience (UX), with the aim of establishing a closer collaboration mechanism and a clearer resource allocation method.
The Ethereum Foundation explicitly pointed out that the newly formed Protocol team will pursue the three strategic objectives and appoint leaders for each strategic direction: Tim Beiko and Ansgar Dietrichs will be responsible for L1 scaling, Alex Stokes and Francesco D’Amato will oversee blob scaling, while Barnabé Monnot and Josh Rudolf will focus on enhancing user experience. They will receive support from renowned researcher and cryptographer Dankrad Feist, the namesake of Ethereum’s new sharding proposal “danksharding,” who previously garnered controversy for receiving a large amount of tokens due to his advisory role with Ethereum’s restaking protocol EigenLayer, later resigning from the advisory position.
Organizational Structure of Ethereum Foundation Before Restructuring
At the same time, the Foundation stated that some R&D members will no longer remain. Although the official announcement did not disclose a specific list of layoffs, it appears that around a dozen R&D personnel have departed, and the departmental responsibilities have become more detailed and clearly defined. EF encourages other ecosystem projects to absorb this group of experienced talents and announced the recruitment of new members, focusing on key positions including user experience lead and performance engineering lead.
The Ethereum Foundation stated that this reorganization will accelerate the pace of converting research results into products and will advance Ethereum’s scalability and user-friendliness with higher standards.
“We hope this new organizational structure will enable internal teams to focus better and drive key initiatives forward. At the same time, we have had to make some very difficult decisions. It is heartbreaking to say goodbye to talented and diligent colleagues. This decision does not reflect any disregard for their value or contributions,” said Hsiao-Wei Weng, co-executive director of the Ethereum Foundation.
However, the reorganization of the Ethereum Foundation has also sparked intense reactions from core developers and industry insiders. “At this moment, the term ‘decentralization’ has quietly and permanently been removed from Ethereum’s roadmap,” stated Ethereum core developer Peter Szilagyi in a post, emphasizing that great companies have long understood that their most valuable asset is people—their team members. Google even explicitly states in its onboarding manual: developers come before users, who are ubiquitous. Organizations that fail to grasp this will ultimately become marginalized. Yes, that is the subtext.
Kyle Samani, co-founder of Multicoin Capital, also questioned the Ethereum Foundation’s strategic adjustments, pointing out that the definition of “focus” typically means reducing rather than increasing, especially stressing that there should be no conflicts between objectives. When considering from the perspective of the third objective (i.e., L1 and L2 network scaling, enhancing user experience), the first objective (i.e., layoffs) contradicts the second objective (i.e., clear division of responsibilities).
Miles Jennings, head of policy and general counsel at a16z crypto, recently stated that the crypto industry needs to move beyond the nonprofit foundation model, as it no longer meets current demands. He believes that while the Foundation played a role in avoiding regulation and promoting decentralization in its early days, it has now evolved into a centralized gatekeeper due to misaligned incentives, legal and economic constraints, and operational inefficiencies, deviating from its original purpose.
With the U.S. Congress proposing a maturity-based regulatory framework, the crypto industry is poised to move beyond foundations. Ordinary development company structures are superior to foundations, enabling efficient capital deployment