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

Ethereum News

On-chain data shows a wallet tied to venture firm a16z withdrew 25,560 ETH from Binance — worth roughly $42.62 million — while Ethereum traded near $1,672. Large outflows from centralized exchanges are typically read as a bullish signal: moving tokens into self-custodied cold wallets usually points to intent to hold rather than sell. a16z has been an active on-chain buyer throughout 2026, having previously been flagged building a roughly $192 million HYPE position. With Ethereum trading well below its $4,946 all-time high and spot ETFs logging repeated net outflows this year, this contrarian accumulation stands out, and the market is watching for follow-up transfers to confirm whether it marks the start of a larger build.

Selling pressure intensified in the early hours of June 25. Bitcoin formally broke below the key $60,000 psychological level, and Ethereum slipped under $1,600 in tandem. Derivatives data shows liquidations across the market surged to $653 million over 24 hours, with roughly 138,796 traders forced out of their positions. The single largest liquidation hit Binance’s BTC-USDT pair, topping $12.01 million. That figure doubled the $325 million wiped out over the same window a day earlier, signaling that long-side defenses had been decisively breached. The slide deepened the bear market mood, with even whales and large institutions unable to exit cleanly amid the extreme volatility.

Ahead of the pre-dawn crash, the market had already seen a sharp leg down late on June 24. Bitcoin briefly fell below $61,000, wicking to a low of $60,892, while Ethereum lost the $1,650 line and touched $1,638. Liquidations over the trailing 24 hours stood at $325 million at that point, with about 88,573 traders cleared out. Breaking the data down further, the heaviest four-hour window accounted for nearly $215 million in liquidations — and longs made up the overwhelming bulk, with $186 million in long positions wiped out, underscoring how unprepared most participants were for the drop. Two consecutive liquidation waves show leveraged longs were systematically flushed within 24 hours as sentiment turned abruptly sour.

Beyond the price pressure, funding for Ethereum’s core development has become a governance flashpoint. Kleros co-founder Clément Lesaege floated a research-forum proposal to route up to 10% of validator staking rewards into an ecosystem fund via the protocol-layer consensus mechanism. He estimates that at current staking levels, a 5% to 10% diversion rate would generate roughly 50,000 to 70,000 ETH a year — about $82.5 million to $116 million. One former insider has warned that core development could face a slow-burning funding crunch within the next three to nine months. Notably, Ethereum’s annualized staking yield has already slid from around 4.6% in 2023 to 2.7%, and squeezing returns further could worsen validator concentration and exit risk.

In contrast to a mandatory protocol-level levy, the newly formed independent nonprofit research outfit EthLabs has chosen a voluntary-sponsorship route. Founded by five former senior Ethereum Foundation researchers, it has secured backing from Bitmine, Sharplink, ConsenSys founder Joe Lubin, and ecosystem participants including Anchorage, Octant and SNZ. EthLabs will focus first on the areas institutions need to come on-chain — faster settlement, stronger interoperability, mainnet capacity, native issuance and cross-chain transfers — alongside research into ETH’s monetary properties. SharpLink’s chief executive framed the launch as part of an Ethereum institutional super-cycle, noting that more than 50 stakeholders moved quickly to commit funding, a sign of confidence in the next phase of blockchain adoption.

At the heart of this structural shift, the Ethereum Foundation has confirmed it is cutting its 2026 budget by roughly 40% and reducing headcount by about 20%. In a blog post, Vitalik Buterin said the foundation will gradually move from spending about 15% of its remaining funds each year toward a long-term outlay of roughly 5% beyond 2030, shifting to a sustainable operating model akin to a university endowment. Alongside co-executive director Xiaowei Wang’s resignation, nine senior figures have departed since January. The foundation will also wind down its privacy and scaling research units and scale back Devcon. Some observers worry the move could amplify outflows from spot Ethereum ETFs, but supporters see it as a sign of maturity on Ethereum’s path toward institutional decentralization.

(as of 01:11 UTC) COINOTAG’s proprietary 42-indicator composite support/resistance scoring engine (data as of 01:09 UTC) shows Ethereum trading near $1,617, down 2.96% on the day. The engine rates strong support at $1,505 a score of 66/100, anchored by the Fibo 0.000, the lower Donchian band and a high-volume node, while resistance at $1,729 scores 63/100 on a convergence of the Ichimoku leading span A, the EMA 20 and the Fibo 0.236. On the derivatives side, the perpetual funding rate sits at 0.0009% with open interest near $5.83 billion and a long/short account ratio as high as 3.60 (78.2% long); against a Fear and Greed Index of just 12 (extreme fear), an overcrowded long side still carries further deleveraging risk. RSI at 34.33 is near oversold and MACD has flipped bullish — holding the $1,505 support could set up a technical bounce, but a break below it would invalidate the bullish case.