With at least nine senior members of the Ethereum Foundation (EF) leaving in 2026 and years of community frustration over EF-related ETH sales, Vitalik Buterin has released his views on the direction of the Foundation.
For Buterin, the FE should become smaller, more opinionated and less central to the future of Ethereum.
He said this only reflects his views and that the board is growing while his own power within the organization continues to decline, which he described as being what he wants.
The dispute now focuses on the Ethereum Foundation’s ETH sales, treasury discipline, and whether outside groups can take over the growth functions that holders want EF to have.
This framework puts Buterin directly at odds with a vocal segment of ETH holders who want the Foundation to behave more like a growth-oriented institution, competing harder with Solana, building the narrative of ETH as an asset, coordinating business development, and scaling up execution.
| Question | Demand from ETH holders | Vitalik’s response |
|---|---|---|
| What should EF be? | Growth-oriented institution | One knot among many |
| What should EF be optimized for? | ETH value, adoption, execution | CROPS: censorship resistance, open source, confidentiality, security |
| What should EF do with ETH? | Stop or reduce the sale | Sell less by becoming narrower |
| Who manages the comics and storytelling of the assets? | EF should coordinate it | Outside organizations should step in |
| What is the risk? | Ethereum undercompetitive | Ethereum becomes too centralized if EF does too much |
He describes EF as “a node, with a defined purpose, alongside other nodes” and says it should prioritize longevity over scale, a choice he explicitly ties to selling less ETH.
Aya Miyaguchi performs much of the transition, with Buterin’s contribution focused on technical matters.
The Ethereum Foundation holds about 0.16% of all ETH, well below foundation allocations of 10-50%, according to Buterin, which are common in other blockchain projects. In April, the Ethereum Foundation’s staking movement reached around 69,500 ETH, nearly reaching a goal of 70,000 ETH and redirecting some of its treasury towards generating yield.
The estimated annual staking revenue of $3.9 million to $5.4 million is well below EF’s historical operating costs of nearly $100 million per year, and staking leaves the need for ETH sales intact.
The Ethereum Foundation’s cash flow therefore remains dependent on either a reduction in expenses, continued sales of ETH, external financing or a combination of the three.
Selling less ETH, under these conditions, means a smaller and narrower FE, as much by fiscal necessity as by philosophical design.
The Ethereum Foundation is smaller by design
The deeper argument of Buterin’s message runs through the Ethereum Foundation’s March 13 mandate, which formalized censorship resistance, open source, privacy, and security as Ethereum’s core institutional identity.
The mandate described the FE as one of many managers, with the success of the FE measured by the reduction in reliance on the FE over time.
Buterin’s message indicated that EF would focus specifically on activities that only EF can credibly perform, some of which Buterin describes as newly achievable through AI-assisted proof systems, while treating the promotion, coordination, and commercial development of ETH assets as work to be absorbed by outside organizations.
Buterin made a Google analogy to illustrate that a single institution with a more idealistic stance produces more lasting value for a broader field than all institutions that bend to dominant pressures.
In a technology landscape that is drifting toward financial capture and surveillance, the Ethereum co-founder said EF positioning itself as something resistant to these pressures creates more value for Ethereum than EF competing as another growth-focused institution.
Community voices have argued that Ethereum needs an organization focused on ETH, the winning asset, executing hard and making noise in institutional markets. Buterin recognizes that supporting ETH, this asset, requires work that EF outsources to outside organizations.
Buterin sees the Ethereum Foundation’s recent brain drain as decentralization in practice, necessary to attract outside capital to important tasks, and leaves unanswered the question of whether outside capital and institutions are materializing quickly enough to absorb this work.
The subtraction test for Ethereum
A smaller, more ideological FE reduces ETH treasury selling, holds the technical roadmap through CROPS-focused work, and gives Ethereum’s base layer credibility that growth-focused foundations trade.
External organizations, privately funded and ETH-aligned institutions, absorb the asset storytelling, business development, and coordination functions that the FE unlocks.
Ethereum is decentralized in practice and protocol, and ETH benefits from a cleaner institutional structure, with treasury selling pressure decreasing at the base layer while a competitive field of external groups drives adoption independently.
Buterin’s ambitions for formal verification, his work minimizing intermediaries, and his Lean consensus building produce the type of technical depth that institutional allocators and developers build into long-term positions.
If the FE loses its institutional knowledge faster than external groups absorb it, Buterin’s thesis on decentralization becomes a brain drain disguised as philosophy.
Upgrade timelines line up with departures, and organizations Buterin is counting on to fill the growth gap slowly or arriving with insufficient capital and coordination to replace what the FE has built over the course of a decade.
With staking generating between $3.9 million and $5.4 million per year, compared to historical operating costs near $100 million, “selling less ETH” translates into spending reductions that accelerate exits before outside institutions can credibly intervene.
| Scenario | What happens | What ETH Holders See | Signal to monitor |
|---|---|---|---|
| Bull case | External groups absorb BD, asset narrative, adoption and coordination | Fewer EF sales, more decentralized execution | New ETH-aligned institutions gain funding and credibility |
| Base case | EF declines, but outgroups fill gaps unevenly | Reduced pressure on cash flow, slower coordination | Some functions are moved outside of EF, but execution remains fragmented |
| Bear case | EF is losing institutional knowledge faster than replacements | Smaller EF looks like weaker execution | More departures, delays in the roadmap, weak external financing |
| Black Swan Affair | Major technical or governance stress tests for Ethereum without strong FE coordination | The “One node” thesis in the face of a real crisis | Emergency coordination, delayed upgrades, public governance conflicts |
ETH holders, watching Solana attract institutional capital through centrally coordinated asset narratives, interpret a smaller EF as a sign of weak execution.
Buterin ends his post by calling the EF a smaller ship than in previous years, more stubborn, but more durable. Meanwhile, ETH holders who spent years asking for a bigger ship are now being told that Ethereum needs an entirely different type of ship.
The bet Buterin’s smaller ship is making is whether Ethereum can outsource growth without an outsourcing emergency.
