AI-Generated
Vitalik Buterin, founder of Ethereum, has confirmed the Ethereum Foundation will lower its budget by roughly 40%. Buterin said the foundation is moving away from its pre-2026 pattern of spending about 15% of remaining funds each year and toward a post-2030 target of about 5% per year.
The changes announcement was made by the Ethereum Foundation to implement its manual and treasury management policies. After the announcement, Ethereum has dropped further.
Ethereum price dipped further by 3.97% to $1,661.90 as selling pressure pushed ETH below the $1,700 level. The market cap is $200.94 billion, decreased by 3.68%. They have a 10.77 billion volume, a drop of 20.06%.
Buterin said the budget reduction initiative involves difficult decisions. This process carries serious financial losses for the company. He said many of them are experienced engineers. Also, the participants who helped build Ethereum’s protocol over many years.
The changes include helping to find new roles across the Ethereum ecosystem. Along with a small grant, the money was given to cover costs such as coaching and other expenses.
Buterin said part of the work was previously handled inside the foundation. He decided that it may shift to the bigger ecosystem of Ethereum. However, the change will not restore everything gone through the budget reduction.
On the other side, the Ethereum Foundation said that the new structure is built around five main work clusters as follows:
Protocol layer
The protocol layer will focus on core Ethereum development, including scalability, censorship resistance, privacy, security, open-source guarantees, and future protocol changes.
Access layer
The access layer will focus on how users and agents interact with Ethereum without relying on intermediaries. Its work covers reading chain data, transacting, proving, delegating, and exiting, with an emphasis on verifiable interfaces and self-custody.
User layer
The user layer will study user needs, education, use cases, and impact measurement.
Community layer
The community layer will manage how the foundation communicates inside and outside crypto
Institutional layer
The institutional layer will work with financial firms, companies, governments, universities, and nonprofit groups on Ethereum-related deployments.
Also, Buterin mentions that the Ethereum roadmap, an efficient teamwork tool without any strict predictions, remains a major technical challenge. This aims to replace or improve several parts of the protocol. Which includes consensus, proofs, privacy, the account model, and state.
He described it as a third phase of Ethereum development after the Merge, although he said it will ship piece by piece rather than through one major event.
As part of the leaner structure, Buterin spoke of Ethereum’s shift toward more specialization. Many parts of Ethereum could rely on AI-based formal verification.
Ethereum Foundation Shifts to New Five-Layer Structure Following Budget Overhaul was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.