Ethereum Foundation cuts staff as network use rises but ETH lags

For ETH holders, the message is uncomfortable: Ethereum usage is growing, but that growth is not lifting the token or the Foundation tied to its development. The Ethereum Foundation said on June 23 that it cut 54 employees, about 20% of staff, after a months-long review. It is also reducing its budget by about 40%.

The move comes while Ethereum posts record operating activity. Token Terminal data for the first quarter of 2026 showed 13.2 million monthly active users, up 53.5% from the prior quarter, with transactions rising 38% to 200.4 million. Throughput also reached a record 25.78 transactions per second. But the financial picture weakened. Layer-1 fees fell 48% quarter over quarter to $39.9 million, total value locked slipped 11% to $316.2 billion, and ETH fell more than 44% this year to about $1,670.

Institutional use kept expanding on-chain without creating matching demand for ETH. Tokenized assets on Ethereum reached $203.4 billion, including $178.9 billion in stablecoins. Tokenized funds grew to $19.4 billion, while US spot Ether ETFs saw seven straight weeks of outflows totaling nearly $1 billion.

The Foundation said the reorganization is meant to reduce sensitivity to market swings and focus more tightly on protocol work. Its priorities now include scaling, user experience, privacy, and limiting risks around MEV and transaction censorship.