Ethereum Foundation May Evolve into a 'Mascot'? Diversified Organizations Are Taking Over Its Functions

Original｜Odaily Planet Daily

Author｜Wenser

Last night, the Ethereum Foundation's protocol support team officially announced its dissolution. Previously, Wang Xiaowei, the co-executive director of the Ethereum Foundation, who was seen as one of the "representatives of the EF organizational reform," also officially resigned. So far this year, at least eight senior personnel have left the Ethereum Foundation.

On the other hand, the organizational and personnel changes reflect the encroachment and functional replacement of the Ethereum Foundation by independent non-profit organizations such as ETHLabs and Ethereum Institutional. Additionally, the Ethereum Foundation's security team has recently made technical progress by employing AI agents to conduct red team testing on the ETH network, discovering real vulnerabilities.

As the ETH price faces waves of industry scrutiny, the Ethereum Foundation is confronted with more complex and diverse contradictions and challenges following internal reforms, related to the ongoing fragmentation of its leadership.

Ethereum Foundation Enters Decline: Rising Rivals, Talent Drain, and AI Changes

The Ethereum Foundation (hereinafter referred to as EF) has long been criticized for its rigid structure, decision-making by a few individuals, organizational value, and market sentiment-affecting sell-off actions. Criticism from within the Ethereum community towards EF has been particularly intense. Recently, David Hoffman, the founder of Bankless, even went so far as to express his dissatisfaction with EF by "selling off the last ETH position" and called on the Ethereum community to build the ecosystem in their own way.

Now, the official dissolution of the EF protocol support team has exposed the internal contradictions and fragmentation crisis of the EF organization to everyone like a thunderclap. It is worth noting that this round of organizational changes is particularly different from the organizational changes initiated by Ethereum founder Vitalik last year—this is a thorough personnel purge, regarded as "the largest layoff since EF's establishment," rather than previous changes in some leadership personnel.

When the Ethereum Ecosystem Leader Chooses to Cut Ties to Survive: The Story of EF's Major Layoffs

Everything began with the official announcement of the "EF New Structure" released by EF on June 23.

In this lengthy article of thousands of words, EF differentiated its new organizational structure into protocol layer, access layer, user layer, community layer, and institutional layer, subsequently explaining that "this organizational restructuring laid off 54 people, accounting for 20% of EF's membership." Even more dishearteningly, the announcement began with the mention: "Through this process, we have obtained the structure, activities, and personnel needed to execute the critical tasks ahead." In other words, the laid-off personnel and departments are deemed redundant, unnecessary, and valueless.

It must be said that EF, which has always presented itself as a research organization and ecological leader with an academic temperament, has revealed a cold side of its organizational management for the first time.

Diagram of EF's New Structure

Dissolution of EF Protocol Support Department Marks Important Sign of EF Organizational Fragmentation

It is worth mentioning that the work of the EF protocol support department is focused on infrastructure construction, mainly responsible for coordinating the Ethereum protocol development process, including organizing and coordinating core developer meetings, tracking Ethereum network upgrades, supporting EIP advancement, and running the Ethereum protocol. Now, its main functions have been allocated to the protocol layer of EF.

On the same day that EF announced the new structure, a non-profit research and development lab called Ethlabs, co-founded by five former EF researchers, officially announced its establishment. This organization aims to promote Ethereum as the settlement layer of the global economy and has received support from Ethereum co-founder Joe Lubin (Chairman of Sharplink, founder of Consensys), ETH treasury company BitMine (Ethereum treasury company under Tom Lee), Sharplink, and various investment institutions, Ethereum ecosystem projects, independent individuals, and EF Foundation members.

List of ETHLabs Community Participants (Source: Official Account)

On July 1, Ethereum Institutional, co-founded by former EF members David Walsh, Marius Smith, and Matthew Dawson, officially debuted.

This organization focuses on the concept of "Ethereum's financial institution application plan," dedicated to promoting institutional-level applications of Ethereum and its secondary nodes, applications, and the entire ecosystem. At the same time, the organization emphasizes its collaboration with Ethlabs, Etherealize, and the Enterprise Ethereum Alliance, responsible for connecting institutional needs and explaining Ethereum's value proposition to banks; Ethlabs focuses on transforming related needs into technical products. As a non-profit independent organization, Ethereum Institutional will provide free Ethereum application-related consulting to banks and asset management companies.

A week later, Ethereum Institutional announced the launch of core team recruitment, focusing on recruiting institutional business development (Institutional GTM), marketing and community operations, as well as solution architecture and technical project leaders in the coming weeks.

Thus, the EF layoff storm officially concluded with the emergence of two non-profit independent organizations and the dissolution of the protocol support department, marking an imperfect end to the "internal organizational reform" that Vitalik personally promoted last year. In addition to the fragmentation at the organizational level and the loss of high-level talents such as executive director Wang Xiaowei, EF also faces the impact of AI technology.

The Era of AI Offense and Defense Begins, EF Security Team Upgrades Testing

Yesterday, researchers from the EF protocol security team stated in a blog post that they have deployed a series of AI agents to test software dependent on the Ethereum ecosystem, searching for vulnerabilities in cryptographic systems, protocol code, and smart contracts.

The vulnerabilities discovered by the AI agents include a remotely triggerable panic issue in the libp2p gossipsub used by the Ethereum consensus client, which has been fixed and disclosed on GitHub as CVE-2026-34219.

Researchers stated that AI agents are organized into specialized roles for reconnaissance, searching, patching, and verification, used to identify potential attack paths, reproduce failures, and verify their applicability to production code. EF stated that AI has not replaced security researchers but has changed the way of working, allowing the team to cover a much broader scope than manual reviews, although researchers need to exercise more cautious judgment over a large number of seemingly credible conclusions.

In light of today's announcement of the official launch of the GPT 5.6 model, the subsequent security maintenance of the Ethereum protocol may be jointly undertaken by AI models and EF security researchers. Moreover, although EF now claims that "AI has not replaced researchers," as AI models continue to develop and evolve, the personnel of the EF security team and even the entire organizational level may further shrink. In other words, EF will face the challenge of AI models on its organizational structure and its own functional performance.

Conclusion: EF's Organizational Reform Phase Comes to a Close, May Become an Ecological Mascot?

Last January, we conducted a systematic analysis of EF's organizational reform in the article "Vitalik Fires the First Shot of 'Reform', Where Is the Ethereum Foundation Headed?" At that time, Vitalik was still ambitiously pushing for EF's organizational reform; this May, after more than a year of organizational innovation, Vitalik instead shifted his tone, stating that "the Ethereum Foundation should not become the center of the ETH ecosystem and will turn to a small and long-termism approach."

It must be said that after ETH has grown to an asset with a market value of over a hundred billion, EF, an official ecological organization established nearly ten years ago, has also entered an awkward position of "a large ship that is difficult to turn around." It is no wonder that Vitalik previously declared—"no longer writing regular blog posts, deciding to try writing some science fiction about decentralized governance."

As former EF researcher and Ethlabs member Ansgar Dietrichs mentioned earlier this month in a podcast, "After failing to break through $5,000 for five years, ETH still lacks a clear value narrative."

Currently, it seems that EF is finding it difficult to take on the banner of "revitalizing the Ethereum ecosystem and driving ETH prices to break through," and future large-scale adoption and institutional-level investments may have to rely on organizations like ETHlabs, Ethereum Institutional, and Etherealize.

Perhaps, in the near future, playing the role of an "ecological mascot" is more suitable for EF.

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