Ethereum Foundation Scales Back Its Role as Funding Pressures Grow

The Foundation is shifting more power and funding to independent groups, while core development still needs about $30 million a year. The debate also touches ETH, DeFi, and stablecoin infrastructure.

Key Takeaways

• The Ethereum Foundation is intentionally stepping back from its central role and giving more authority and credibility to independent institutions.
• Trent Van Epps says Ethereum core development costs about $30 million a year, and current funding still falls short.
• He expects Ethereum governance to keep decentralizing over the next 10 years, with a smaller Foundation and more groups focused on research and ecosystem growth.

The Ethereum Foundation is actively pulling back from its position at the center of the ecosystem, and that is putting fresh pressure on how Ethereum’s core development gets funded. Trent Van Epps, who previously worked at the Foundation, says the group wants to decentralize further and pass more of its authority and legitimacy to a wider set of independent institutions. The move comes as the Foundation has also gone through leadership changes and staff reductions, prompting new questions about where Ethereum governance is headed next.

Funding Challenges for Core Development

Van Epps does not describe the situation as a crisis, but he does see a real funding problem. He says maintaining Ethereum’s core protocol costs roughly $30 million a year. At the same time, the Foundation is spending less and its treasury is gradually getting smaller, which makes it more important for new organizations to help pay for the public goods that keep the network secure and dependable. His own project, the Protocol Guild, has sent nearly $40 million to Ethereum developers over the past four years, but Van Epps says that still does not fully cover the broader need.

The Future of Ethereum Governance and the Ecosystem

Looking ahead, Van Epps expects Ethereum governance to become even more distributed over the next decade. In his view, the Foundation will continue to play a smaller and more specialized role, while other organizations take on more of the work around research, commercialization, and ecosystem expansion. He also argues that ETH needs stronger support as an asset, along with a clearer narrative that ties the token to the growing onchain economy. Even with the funding questions still unresolved, Van Epps remains upbeat about Ethereum’s position in decentralized finance, stablecoin settlement, and EVM adoption, and he believes billions of users will eventually interact with Ethereum and its Layer 2 networks.

Relevance for European Crypto Developments

These changes in Ethereum’s governance and funding model could also matter for European crypto investors and builders, since the same mix of decentralized funding and institutional coordination may gain traction in Europe as well. It underscores how important durable funding systems are for public infrastructure in crypto, especially as rules like MiCA continue to roll out across the region. The recent restructuring of the Ethereum Foundation is a clear sign that this transition is already happening in practice.