Ethereum must have unique competitive advantages.

Written by: Vitalik Buterin

Translation: Luffy, Foresight News

I would like to discuss a few thoughts on the future direction of the Ethereum Foundation (EF).

First, I want to clarify that the following is only my personal opinion. The foundation’s board is not solely guided by me; my authority is no different from that of other board members. The organizational transformation is largely being driven by Aerugo, and I primarily provide input on the technical level. Currently, the board is in an expansion phase, and my influence within the foundation will continue to decrease, which is precisely the result I hope for.

By 2025, the overall execution capability of the Ethereum Foundation has been greatly improved, and many historical issues have been resolved. To this day, the efficient operation model and clear, pragmatic goal orientation have allowed Ethereum to continue to benefit.

After the difficulties were resolved one by one, I noticed an increasingly prominent hidden danger at the beginning of this year: I often hear doubts from the outside, questioning why Vitalik consistently advocates that Ethereum should stick to decentralization, emphasize privacy, and become a secure and reliable technology, but why don’t the actions of the Ethereum Foundation reflect this?

Of course, you may hear different voices. You may feel no sense of crisis at all, and you might even hear people saying we have finally started to take execution and business expansion seriously, and our main task is to maintain this momentum, to do better and faster. Thus, there may indeed be a true divergence between you and me regarding which types of criticism I value most and which types of criticism affect me the most.

For example, let’s first look at the polarized opinions on Google. Some believe it integrates global information and creates great value for human society, serving as a model of success; others feel that Google had a noble intention initially but was eroded by commercialization later, completely betraying its founding motto of "do no evil."

My personal view lies between the two. However, if I could return to 2008 and was given a button that, when pressed, would make Google "more dogmatic," such as granting Richard Stallman a permanent veto over certain key policies, I would press it without hesitation.

Why? Because the choices of a company do not represent the choices of the whole world, nor even of a country. The emergence and development of Google occurred against a backdrop where the tech industry as a whole deviated from the early idealism of "do no evil" in pursuit of commercial interests; blindly adoring super-intelligent technology expansion; opportunists infiltrating the industry; and companies either succumbing to the demands of control, surveillance, and military-related governments, or even actively cooperating with such actions.

In this larger trend, if a company can go against the tide, maintain a unique philosophy, and stay true to its original intent, it will be far more beneficial for social freedom, power balance, and overall stability than having all the giants following the current. This is also my understanding of diversity. This line of thinking is not exclusively mine; it is also closely related to the core ideas proposed by Aya and others when they initially defined the foundation’s mission.

So, how is all of this connected to the mission of the Ethereum Foundation?

The Ethereum Foundation is not the absolute core hub of the Ethereum ecosystem, but merely one member among many ecological nodes with a clear functional orientation. We have always emphasized that the Ethereum Foundation should play the latter role, but many people in the Ethereum ecosystem (including many within the Ethereum Foundation itself) hope we play the former. Now, we are taking action to ensure that we can become the latter.

This positioning adjustment is crucial. The foundation itself has limited manpower, financial resources, and organizational size: its total ETH holdings account for only 0.16% of the entire network, which is even less than many individual holdings; while other public chain official foundations generally have token proportions ranging from 10% to 50%.

From its initial intention, the foundation's original mission was limited to the scope defined by the token sale documents, focusing on the development of the underlying public chain, completing version iterations such as Frontier, Homestead, Metropolis, and Serenity. This task was completed back in 2022, and it was never meant to be a permanent manager.

At this stage, the foundation has decided to allocate its remaining resources, prioritizing the long-term survival of the ecosystem rather than blindly expanding its business, which also means the foundation will reduce ETH selling behavior. Future work will focus on a core set of tasks: maintaining Ethereum’s resistance to censorship, asset seizure, openness, privacy, and security, ensuring the key constructions that are difficult to implement through other entities.

Trade-offs are inevitable; some projects we recognize and respect, as well as some practitioners, will subsequently operate outside the foundation's system. Even if team members are technically strong and have a good reputation, aligning values with the core principles makes it necessary to externalize related businesses, which can attract external capital for joint construction while allowing the foundation to form a distinct independent value stance.

The foundation's future development will be coordinated with various stakeholders in the ecosystem. Most entities within the ecosystem agree on core value criteria, but agreement does not mean wholehearted commitment. It is like recognizing the concept of treating animals well and loving vegetarianism; it does not mean a person will completely become a vegan.

The foundation is still in a transitional period, and it is expected that a new long-term stable structure will be finalized within the next few months. Below, I will discuss the core principles of transformation from a technical perspective, as organizational development also depends on key considerations beyond the technical level.

Ultimately, Ethereum must possess unique competitive advantages. Currently, artificial intelligence is rapidly iterating, and various technologies are experiencing explosive growth. If Ethereum clings to its existing structure and only relies on several hard forks a year to adapt to short-term user demands, it will lose its core appeal.

Some believe that competitiveness means millisecond-level latency and million-level transaction processing speed. In my opinion, merely chasing high-speed expansion only gives a slight advantage in decentralization compared to other public chains and ultimately leads to mediocrity; this path simply does not work.

Ethereum needs to scale, but it must also emphasize resistance to censorship, asset seizure, openness, privacy, and security, with specific implementation directions as follows:

• Create a verifiably no-vulnerability Ethereum. Just half a year ago, network security researchers across the web believed that a zero-vulnerability public chain was nothing more than a pipe dream. Now, with the help of AI formal verification technology, this goal is about to become a reality, and Ethereum should seize the opportunity to achieve breakthroughs first.
• Stabilize a hybrid on-chain consensus mechanism. Ethereum combines two types of consensus characteristics: having traditional Byzantine fault tolerance attributes and being resilient to a high percentage of malicious node attacks in asynchronous networks; at the same time, it possesses Bitcoin’s proof-of-work characteristics, making it resistant to 49% hash power attacks in synchronous networks. Looking at the industry, no other public chain simultaneously possesses these dual features. Bitcoin only focuses on the latter, while most public chains ensure the former. I firmly believe in this design logic: Ethereum cannot rely on community consensus or hard forks to save the 34% of nodes that are offline; consortium chains and some mainstream public chains may accept such fallback methods, but Bitcoin and Ethereum must uphold the baseline of underlying consensus.
• Minimize intermediate steps. Currently, smart contract wallets and privacy protocols initiating transactions still require third-party intermediaries to go on-chain, which not only provides a poor experience but also hides systemic risks. The team is advancing optimizations related to FOCIL, EIP-8141, etc., relying on an open transaction memory pool to strengthen transaction packaging certainty, comprehensively streamline transaction intermediary processes, and adapt to various scenarios like elliptic curve signatures and privacy protocols. At the same time, the user end is also being optimized and upgraded to eliminate the downsides of wallets not verifying blocks and privacy data leaking to third-party platforms, evolving towards an ideal form of security and privacy.

Some of these goals may not be realistic; perhaps Ethereum "can accept" only completing 50% of the goals. But what if we rely on intermediary institutions and make it easy for users to switch? However, simply achieving 50% of the goals does not make Ethereum strong enough. Therefore, we strive to realize these goals 100%.

Fortunately, the core goals mentioned above do not conflict with high transaction processing speeds, and expanding the underlying state is also a key research direction. A well-designed layer two network can also empower the ecosystem, and its value in vertical scenes such as transactions and privacy is particularly outstanding. Coupled with erasure coding peer-to-peer technology and various optimization schemes, the block interval is also expected to be further shortened.

From a financial perspective, ETH is the core value carrier of Ethereum, with the total ETH asset scale across the network reaching $250 billion. The technical characteristics mentioned earlier will continue to ensure the stability of ETH's value. Personally, nearly 90% of my assets are in ETH, and the remaining funds of approximately $40 million in stablecoins have all been invested in open-source biotech and hardware-software development projects.

Of course, part of the work to maintain ETH's value does not fall within the responsibility of the foundation. This requires the other stakeholders in the ecosystem to work together, as many individuals and institutions hold much larger positions than the Ethereum Foundation; we are also planning to establish contacts with these organizations to provide the necessary initial support.

The future Ethereum Foundation will be leaner in scale and its value stance will be clearer. In certain cases, this clarity may be difficult for the public to understand. However, it will endure longer, remain true to its original intention, and ensure that Ethereum brings meaningful contributions to the world.