The Ethereum Foundation has cut 20% of its workforce and reduced its annual operating budget by roughly 40% as part of a major restructuring in 2026, moving from a central operator to a long-term steward role. The changes follow months of community criticism over governance and execution issues, and include the departure of nine senior leaders and researchers — the biggest personnel shake-up in 12 years.
Leadership changes and the CROPS framework
In February 2026, co-executive director Tomasz Stańczak resigned, marking the start of the reorganization. The foundation then published a new strategic document centered on the CROPS framework — censorship resistance, resilience, openness, privacy, and security. Under this model, the foundation redefined itself as a "long-term steward" rather than the ecosystem's central operator, signaling a shift toward setting principles rather than directly coordinating development.
Workforce reduction and budget cuts
The pace of change accelerated in June. After co-executive director Hsiao-Wei Wang stepped down, the foundation eliminated 54 positions — about 20% of its total staff — and slashed its annual operating budget by roughly 40%. The remaining organization was restructured into five core operational groups. The foundation stated the cuts were necessary to focus on areas only it can handle, aiming for a leaner and more sustainable structure.
Rise of external organizations
As the foundation scaled back, new external entities emerged to take on some of its former roles. ETHLabs, backed by major Ethereum-based companies, launched to handle protocol research, product development, and ecosystem coordination. In July, Ethereum Institutional was unveiled to support institutional investors, asset managers, and nonprofits with research, education, and standard development. Additionally, the for-profit firm EthSystems began building privacy-focused trading infrastructure for financial institutions, absorbing more of the foundation's previous responsibilities.
A shift from centralization to distribution
The 2026 overhaul goes beyond simple restructuring — it represents a fundamental transition of the Ethereum ecosystem from a foundation-centric model to a distributed one. While the foundation has shrunk, independent organizations are now taking on research, development, and institutional outreach. The key question is whether this new collaborative structure will ultimately strengthen the network's competitiveness.