- Amid recent high-profile departures from the Ethereum Foundation, debate now revolves around whether a new entity is needed to replace the Foundation.
- Some accuse the Foundation of abandoning the plight of the token holders to pursue ideologies and a communist structure.
The leadership crisis at Ethereum is spiraling. Following the exits of key figures over the past year, the community is now questioning the Ethereum Foundation’s role, with some proposing the formation of a new entity that aligns with the token holders.
The latest reshuffle at the Foundation was two weeks ago. As we reported, three key leaders who have been steering the Protocol team departed. Two left the space permanently, while the third was said to be taking a sabbatical. The three have been critical to the network’s development over the past decade, pushing upgrades like the Merge, EIP-1559, Pectra and more.
Simon Dedic, the founder of Moonrock Capital, says the rate of exits is alarming. He noted that some of the names that have left “weren’t just random employees at the foundation, they were the foundation.”
Moonrock is an early investor in crypto companies like Blockworks, Turtle Club and Inversion.
Dedic stated:
“You can call it restructuring, you can call it decentralization, whatever. But when your best people are walking out the door, that’s a massive red flag regardless of what narrative you put around it.”
He believes that Ethereum is being derailed by politics and ideologies that put structure over product. He pointed to Hyperliquid recently flipping Solana in FDV as proof that a great product can inspire a massive community. It does not always have to start from the ground up.
Has the Ethereum Foundation Lost Its Way?
Others believe that the Ethereum Foundation has abandoned its original mandate and is now caught up in pushing ideologies. One of these is Laura Shin, the ex-Forbes journalist who has become a leading voice in crypto via her Unchained media brand.
According to Shin, Ethereum’s “original sin” was abandoning tokenomics since the Dencun upgrade.
I think Ethereum’s original sin was not considering tokenomics with every move it made from Dencun on.
The ultrasound money thesis was a good one and with Dencun (or the L2 roadmap generally) they should have stopped to say that this was going to hurt the ultrasound money thesis…
— Laura Shin (@laurashin) May 21, 2026
Ethereum has risen to the top on the idea of ultra-sound money, but in the past two years, it has gradually been detaching from this in favor of communist ideologies, Shin believes.
She stated:
“When the main offering becomes ideology/communism and money/tokenomics/capitalism are overlooked, the peasants are going to revolt — as they’ve been doing for two years now.”
Shin acknowledges that ideology and tokenomics are not mutually exclusive; the Foundation can work on pushing both. However, it has abandoned the token holders to pursue the ideology of global good, and eventually, this will cost it the community that had given it this power in the first place.
Shin shot a warning to Vitalik Buterin, whom he says might have been too young to remember the early days of the internet, when the most dominant companies collapsed and were forgotten. Ethereum is not too big to fail either, she points out.
The solution might be to create another entity that aligns with the Ethereum community better than the Foundation currently does, proposes Dankrad Feist, a seasoned Ethereum developer. He noted that the Foundation now holds less than 0.1% of the ETH supply and would not be affected greatly by a price collapse.
The way to save Ethereum: The community needs to create an organization that's economically aligned with Ethereum and accountable to it.
The EF now holds less than 0.1% of all ETH. There is no flow of Ethereum staking or fee revenues to it.
If we want to get Ethereum back to…
— Dankrad Feist (@dankrad) May 21, 2026
The network needs a new entity that would start with at least $1 billion in ETH funding and with “a leader who is competent and wants to fight.” It should also have a board that wants to push ETH prices higher. It would be funded with a share of the revenue from staking.
ETH trades at $2,120, gaining 4.5% in the past day as a ceasefire in Iran pushed most cryptos higher.
