Here’s a smooth and refined rewrite:
In this week’s Protocol Newsletter, we take a closer look at the series of changes that have reshaped the Ethereum Foundation over the course of this year.
The foundation began 2026 under increasing pressure. Developers, investors, and key voices within the Ethereum community had been raising concerns for months about its execution speed, governance model, and technical direction. Critics argued that the roadmap had become too focused on layer-2 scaling, at the expense of strengthening the base layer.
The first major turning point came in February, when co-executive director Tomasz Stańczak stepped down after helping guide the organization through early restructuring efforts. Soon after, the foundation released an updated mandate that narrowed its role within the ecosystem. Built around the CROPS principles—censorship resistance, resilience, openness, privacy, and security—the shift repositioned the foundation as a long-term steward rather than the primary builder or coordinator.
Following the leadership change, a wave of departures unfolded. Over the next several months, nine senior leaders, researchers, and executives exited the organization, marking one of the largest turnover periods in its history. While the departures fueled speculation, leadership maintained they were part of a deliberate reset rather than a sign of instability.
That reset intensified in June. Co-executive director Hsiao-Wei Wang resigned, and shortly afterward the foundation announced its most sweeping restructuring yet. Roughly 20% of its workforce—about 54 roles—were cut, and its annual budget was reduced by nearly 40% to improve efficiency and sustainability. The remaining staff were reorganized into five core groups focused on areas where the foundation sees its unique value.
At the same time, new organizations began stepping in to handle responsibilities previously managed by the foundation. ETHLabs launched with backing from major ETH treasury firms to drive research, coordination, and product development. In July, Ethereum Institutional was introduced to support enterprises, asset managers, and nonprofits through research, education, and standards development. Shortly after, EthSystems emerged as a for-profit venture focused on building privacy-focused infrastructure for institutional users.
Taken together, the developments of 2026 mark the most significant transformation in the foundation’s history. What began as criticism over governance and technical priorities has led to a leaner organization, new leadership, a clearer mandate, and an ecosystem increasingly driven by independent groups advancing research, adoption, and protocol development.
