Ethereum Foundation Cuts 54 Jobs, Ethlabs Launches as ETH Slips Near $1,670

Ethereum News

Ethereum was swept into a broad crypto liquidation flush overnight, with nearly $1 billion in leveraged futures wiped across majors as Bitcoin briefly tagged $59,175, its lowest level since early June, before steadying near $61,500. Ether tracked the move lower in lockstep before recovering. The selloff carried no single catalyst, instead reflecting a hawkish Fed, six consecutive weeks of spot ETF outflows, thin summer liquidity, and a looming June 30 quarter-end options expiry that traders say is keeping positioning unstable. A late bounce in equities, driven by stronger-than-expected memory-chip earnings and a major Asian listing plan, helped altcoin majors including ETH claw back part of the intraday damage.

The leverage damage hit Ethereum especially hard. Over $600 million in long positions vanished within hours on June 24, and ETH absorbed roughly $188.8 million of liquidated longs, second only to Bitcoin's $336.5 million across tracked venues. On the snapshot, Ether posted a 4.91% daily loss, steeper than Bitcoin's 4.07% and among the worst of the large caps. Centralized exchanges took the heaviest hits, with Binance alone recording about $350.6 million in liquidations, far ahead of Hyperliquid at $147.2 million and Bybit at $120.1 million. ETH steadied near $1,606 after the flush, underscoring how concentrated long positioning amplified the downside.

Beneath the price action, a structural reshaping of Ethereum's institutional core dominated the week. The Ethereum Foundation announced a roughly 40% budget cut and laid off about 20% of its workforce, just one day after the launch of EthLabs, a new research organization backed by more than 50 ecosystem stakeholders. The timing fueled debate over whether the network's most influential institution is under genuine financial strain, with some commentators warning the squeeze could feed further outflows from spot ether exchange-traded funds. Supporters framed the foundation's downsizing instead as a deliberate decentralization of Ethereum's development, shifting research weight toward a broader, institutionally backed coalition.

Prominent ecosystem figures leaned bullish on the restructuring rather than reading it as retreat. SharpLink chief executive Joseph Chalom, whose firm is among EthLabs' backers, said the speed at which over 50 stakeholders stepped up to fund the new entity signaled deep conviction, arguing institutional capital is moving onchain now. The optimist case holds that splitting research across EthLabs and a leaner foundation makes Ethereum more resilient and less dependent on a single organization. That argument lands as the network competes with rival smart-contract chains while courting demand for stablecoins, tokenized assets, and onchain financial infrastructure, segments where Ethereum still anchors the largest share of activity.

The macro backdrop kept risk appetite suppressed across the board. Bitcoin had shed roughly 10% from Monday's peak near $65,500, dragging the wider market lower and pressing Ether alongside it. Market-makers had flagged the $59,000 region as a key bear market line to watch, and that floor held on the overnight test. Still, sizable leveraged long clusters sit below the line, meaning a decisive break would risk accelerating the decline. With a quarter-end expiry and the Fed's preferred inflation gauge both landing this week, traders are bracing for elevated volatility that could swing Ethereum sharply in either direction before month-end.

The cross-asset linkage that has defined the week cut both ways for Ethereum. Crypto had been sliding alongside the AI trade, and the same chip-sector anxiety that rattled Asian equities earlier in the week ultimately steadied the complex once blowout memory earnings reframed AI demand as structural rather than speculative. That correlation leaves ETH exposed to swings in risk sentiment well outside its own fundamentals, from rate expectations to semiconductor results. For now, the recovery off the lows has been modest, and with ETF flows still negative and leverage freshly purged, Ethereum's near-term path hinges as much on macro confirmation as on its own onchain momentum.

COINOTAG's proprietary 42-indicator composite S/R scoring engine (as of 07:01 UTC) rates the $1,623 support at 73/100, the strongest level on the board, driven by the confluence of the S1 pivot and the prior-day close, with the $1,505 zone behind it at 69/100 from the Donchian lower band and a high-volume node. Overhead, the $1,730 resistance scores 67/100 on Ichimoku Senkou A and the 20-period EMA. Derivatives data shows a near-flat 0.0025% funding rate and $5.96 billion in open interest, while a 3.0 long/short account ratio (75% long) flags crowded bullish positioning vulnerable to further squeezes. With RSI at 37 and the Fear & Greed Index at 12 (Extreme Fear), reclaiming $1,730 would open the path toward $1,873; losing $1,623 invalidates the bid and exposes $1,505.