The Ethereum Foundation is taking continuous action, with funds flowing into ETH spot ETFs.

Written by: 1912212.eth, Foresight News

The author previously wrote an article titled "The Wealth Effect is Severely Diminishing, Can Ethereum Survive its 'Midlife Crisis'?" detailing the significant challenges Ethereum faces in this cycle, including a lack of innovation, a loss of direction, and an oversized team, which have led to harsh criticism from the community. Vitalik has also been brought down from his pedestal and faced severe backlash. However, after a period of extreme pessimism, the market has rebounded. In April of this year, ETH surged from $1,400 to nearly $2,800.

Is Ethereum's fundamental situation improving? What noteworthy changes are happening with Ethereum, which has been heavily criticized recently?

Continuous Net Inflows into Ethereum Spot ETFs

There was a time when Ethereum spot ETFs were in a long-term state of net outflow. However, since April 22 of this year, market funds have started to flow in continuously. As of June 5, there was only a seven-day net outflow, with the rest being net inflows, and there were even four days with a single-day net inflow exceeding $90 million, and seven instances of single-day net inflows exceeding $60 million.

According to SoSoValue data, the cumulative net inflow into U.S. Ethereum spot ETFs has risen to $3.23 billion, with no signs of slowing down.

Negotiating Collaborations with Sovereign Wealth Funds of Major Countries

Joe Lubin, co-founder of Ethereum and CEO of Consensys, stated on Tuesday that his company is in negotiations with the "main sovereign wealth funds and banks" of a "very powerful" country regarding potential collaborations based on Ethereum, involving both layer one and layer two infrastructure. However, the details of the collaboration have not been disclosed, and the market's reaction to this news is largely based on expectations. If this news is ultimately confirmed and announced, it will undoubtedly play a significant role in boosting market confidence.

In addition, Consensys has acted as the lead investor in SharpLink Gaming's $425 million financing, and Joseph Lubin will serve as the chairman of SharpLink's board after this round of financing is completed.

Bitcoin has been continuously accumulating strategies, leading more companies to follow suit, driving strong buying pressure on the coin price. Ethereum should have companies to drive purchasing power.

As a Nasdaq-listed company, SharpLink plans to use the proceeds from this financing to purchase Ethereum's native asset, ETH, and use it as a primary treasury reserve asset.

According to Bloomberg, Joe Lubin mentioned that about six months ago, under the influence of the most prominent advocates for digital asset accumulation, he decided to establish a company to invest in Ethereum's native token. "I was having dinner with Michael Saylor, did some research, and started discussing how cool this idea was with my colleagues," Lubin, founder and CEO of Ethereum software infrastructure company Consensys, said in an interview. "No one in our company had previously delved into this direction. Later, we found that this strategy seemed to have no particularly dangerous aspects."

Ethereum Foundation Layoffs and Reduction of Operating Expenses

The Ethereum Foundation has faced criticism for its oversized team. On June 3, the foundation finally took action to lay off some employees and reorganize its research and development team, renaming the department to "Protocol" to focus on the core challenges of protocol design. This adjustment aims to address the community's ongoing criticism of the foundation's management and strategic direction. The foundation stated that the restructured Protocol team will work on three main priorities: expanding the scalability of the Ethereum underlying network, advancing blobspace expansion in data availability strategies, and improving user experience.

The foundation mentioned in its announcement that "some members of the R&D team will no longer continue to stay," and encouraged other teams to absorb these talents. The number of layoffs has not been disclosed. Additionally, the foundation stated that the restructured team will focus on enhancing the transparency of upgrade timelines, technical documentation, and research. Co-executive director Hsiao-Wei Weng expressed on social media platform X that he hopes the new structure will enable core projects to progress more efficiently.

However, some have pointed out that key issues remain unresolved. Kyle Samani, co-founder of Multicoin Capital, commented on Twitter, "Please note that the definition of focus typically means less, not more, especially when the goals should not conflict with each other. But when we look at it from the perspective of Goal 3 (i.e., L1 and L2 network expansion, improving user experience), Goal 1 (i.e., layoffs) contradicts Goal 2 (i.e., clarifying responsibilities)."

The Ethereum Foundation announced a new financial management policy in June 2025, aimed at ensuring long-term financial sustainability. According to the official blog, the foundation has set annual operating expenses to not exceed 15% of total assets and plans to gradually reduce this to 5% over the next five years. Additionally, the foundation will maintain a 2.5-year operating expense buffer and regularly assess whether to sell ETH to replenish fiat reserves. This policy reflects the foundation's prudent approach to treasury management, especially in a market environment with significant ETH price volatility.

The foundation also emphasized that on-chain funds will only be deployed in audited, decentralized DeFi protocols, focusing on low-risk strategies such as staking and lending. This initiative not only reduces funding risks but also aligns with Ethereum's "Defipunk" principles and privacy protection concepts.

In the past, the Ethereum Foundation's selling behavior often drew community dissatisfaction after being monitored and reported. Now, the foundation has finally chosen to adopt a more cautious approach to address spending issues. These measures indicate that the foundation is laying the groundwork for Ethereum's long-term development by cutting operating costs and optimizing resource allocation, while also providing reassurance to the market by alleviating selling pressure.

Gas Limit Adjusted to 60 Million

Recently, Ebunker tweeted that, with 15% validator support, Ethereum is expected to raise the block gas limit to 60 million. The higher the gas limit, the more transactions a block can process, thus increasing network speed. Among various scaling paths, raising the gas limit can be considered the most immediate method. Furthermore, increasing the gas limit does not require system upgrades or code modifications; as long as PoS nodes continuously "signal" support during block production, the network can gradually adopt this change.

Although Ethereum has historically scaled through L2 and Rollups, it has also encountered significant issues. "L2 greatly weakens ETH's value capture and can easily lead to a fragmented situation," said Pi Ma, founder of Continue Capital, during a voice conversation.

Scaling the mainnet has become imperative. At the ETHGlobal Prague conference, Vitalik stated that Ethereum will expand L1 scale by about ten times within a year, and then "take a breather" before the next leap.

Ethereum's current TPS peak has risen to about 60, and it remains to be seen how much further Ethereum will increase.

Summary

Ethereum is undergoing multiple transformations in technology, funding, and ecology. The foundation's financial reforms and R&D restructuring lay the groundwork for its long-term development, while the collaboration between Consensys and sovereign wealth funds signifies Ethereum's new role in global finance. The adjustments to the gas limit and the inflow of ETF funds inject vitality into network efficiency and market momentum.

Despite short-term selling pressure and cost disputes, Ethereum's technological advantages and institutional endorsements still position it as a leader in the crypto market. In the future, Ethereum needs to continue to focus on technological optimization and community governance to address challenges from competitors like Solana. 10x Research recently analyzed ETH's performance, stating, "Although we anticipated a wave of correction a few days ago, the actual trend has proven to be more resilient than expected. From a technical perspective, Ethereum is approaching the apex of a large triangular consolidation structure, and the eventual breakout direction could push the price towards $2,000 or $3,000. This trend will be crucial and may be triggered by fundamental changes or simply by the entry of a large buyer."

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