EthLabs Launches as 9 Executives Exit Ethereum Foundation Since January

Ethereum’s governance saw major changes in just one day. The Ethereum Foundation announced 54 layoffs and a 40% budget cut. At the same time, five former Foundation researchers launched a new group called EthLabs. Another group, Ethereum Institutional, also started that day to connect with banks and asset managers. These changes mark the biggest reorganization in Ethereum’s history.

The order of these events helps explain the changes. EthLabs launched on July 1, just one day before the Foundation announced layoffs and soon after co-executive director Hsiao-Wei Wang resigned. Since January, at least nine senior leaders, including both co-executive directors, have left the Foundation. This shows ongoing leadership turnover, not just a one-time event.

Who Funds Ethereum Research Now

EthLabs, led by executive director Ansgar Dietrichs, has a clear goal: to get Ethereum ready for large-scale use by institutions by improving settlement speed, scalability, and protocol economics. Unlike the Foundation, which used its own ETH funds for research for about ten years, EthLabs is backed by co-founder Joe Lubin and companies like Bitmine and SharpLink. Both companies are publicly traded and hold a lot of ETH.

This funding setup creates a clear tension between financial interests and independent research. EthLabs has put certain safeguards in place to address this:

• Funders receive quarterly reports and an independent annual review
• Corporate backers have no direct say over the research agenda
• Scientific leadership retains control over research priorities

Whether that separation holds in practice will determine if EthLabs becomes a model for funding open-source research without ceding control to capital, or simply shifts Ethereum’s dependence from a foundation to corporate stakeholders with a financial stake in its success.

Complementary Roles or Emerging Rivalry

Officials say the new setup is meant to be complementary. The Foundation will focus more on values, while EthLabs will handle more practical research. SharpLink CEO Joseph Chalom has said that the two groups will probably overlap in the future, and that most technical talent is now at EthLabs instead of the Foundation.

The Ethereum Improvement Proposal process, which limits the number of protocol upgrades, means there will be some competition between the two groups no matter what they say.

A possible funding gap adds more uncertainty. A former Foundation coordinator says the gap is a real risk, but Bitmine’s chairman disagrees and says the concern is not valid. Right now, neither claim can be confirmed, so this issue is worth watching in the next few months.

Overall, this looks like a move toward decentralization, spreading responsibility among different groups instead of keeping it in one place. Whether this setup works as planned will depend on whether EthLabs can really shape Ethereum’s technical direction. The first quarterly reports should show if the separation between funders and researchers holds up when tested.