Key Takeaways:
A former Ethereum Foundation contributor warned the network's core development could run out of funding within three to nine months after the Community Incentive Program expired.
Ethereum's core development could face a funding crisis within three to nine months after the Community Incentive Program expired, a former Ethereum Foundation contributor warned.
"The CIP expiration creates a looming gap in financial support for protocol development that the foundation has not yet addressed," VanEpps, a former contributor at the Ethereum Foundation, said.
The warning comes as the foundation has shed an estimated 19 staff and contributors this year, including co-executive director Hsiao-Wei Wang, who stepped down this month. Ether traded at $1,708 as of Thursday, down nearly 66% from its all-time high of $4,946 set in August 2025, according to CoinGecko data.
If core development funding dries up, critical upgrades such as Pectra and future scalability improvements could face delays, potentially pushing developers to competing chains and eroding Ethereum's competitive edge against Solana and other Layer-1 networks.
The CIP was designed to fund ecosystem development through community-driven incentives. Its expiration removes a key funding stream at a time when the foundation is already under financial pressure. Ethereum co-founder Vitalik Buterin signaled in May that the EF would transition into a "smaller ship," creating a leaner team focused on censorship resistance, privacy and security.
Buterin has also pushed back against criticism that the foundation should play a more active role in promoting the network, saying the EF "is not the 'center of Ethereum,' rather 'one node, with a defined purpose, alongside other nodes.'"
The foundation's revised mandate, unveiled in March, doubled down on decentralization as its core mission. "Our ultimate goal is for Ethereum to pass the walkaway test: its protocol and core application layers become robust and trustless enough that they would continue to reliably function and evolve even if the Foundation and today's core developers disappeared tomorrow," the foundation said.
Not all former contributors share that confidence. Dankrad Feist, a top researcher who left the EF earlier this year, suggested the community needed to create a new organization with at least $1 billion in ETH funding to "save Ethereum." He posted on X that the ecosystem needs "a leader who is competent and wants to fight."
The foundation has taken steps to shore up its finances. It began staking its treasury earlier this year, targeting roughly 70,000 ETH staked, and implemented a more transparent treasury policy detailing when it would sell ETH. Still, with Ether down more than 65% from its peak, the value of the foundation's primary asset has shrunk considerably.
The funding uncertainty threatens to compound Ethereum's broader challenges. The network faces intensifying competition from faster, cheaper Layer-1 chains, while its own Layer-2 scaling strategy has drawn criticism from Buterin himself, who recently said the original vision for L2s "no longer makes sense."
This article is for informational purposes only and does not constitute investment advice.
