jakiro
Author: Lane Rettig, former core developer of Ethereum and former employee of the Ethereum Foundation; Translation: Bitchain Vision xiaozou
Ethereum will celebrate its tenth anniversary in a few weeks.However, the project and the community still have internal divisions and differences in development directions, and they are struggling in the increasingly fierce competition.I wrote it last weekThree major problems with Ethereum’s troubles, and why the market sentiment has fallen to the lowest point I have ever seen.The reasons mentioned last week were mainly culturally related.This article continues to bring three more pragmatic reasons: talent crisis, user experience fragmentation, and governance issues.
1. Talent Crisis
As mentioned in the previous article, I worked at the Ethereum Foundation in different identities between 2017 and 2019.I have been involved in multiple dysfunctional organizations throughout my career, and in an industry dominated by talented but autistic builders, early projects seem inevitable.Even by these low standards, the Ethereum Foundation is the most chaotic organization I have ever been involved in (more on this below), which has caused serious problems in attracting and retaining talent.
Talents often favor merit-based environments, knowing that hard work and excellent performance will pay off and promote.What I saw at the Ethereum Foundation is exactly the opposite: there is a serious talent exclusion here.Unfortunately, this also reflects the current situation of the entire Ethereum ecosystem.Ethereum’s success does not stem from a good talent attraction or retention mechanism, but rather survives a lucky life in the extremely deformed talent pipeline.It really doesn’t do well.
My personal experience at the foundation is a typical case and a microcosm of the Ethereum ecological talent problem.According to my observation, most of the people in power in the foundation should not be in power.They are not hired or promoted because of their talent. On the contrary, they are friends of Vitalik, various special relationships trusted by Vitalik, and even hypocritical people.Although most members of the foundation are kind and diligent, some of them have a worrying character, even quite degenerate and have a strong desire for power.
There are two problems with this selection mechanism: first, it cannot select strong leaders, and second, it will hit the morale of other members.It clearly sends a signal that in the foundation or Ethereum ecosystem, success does not depend on efforts or ability, but on the right time and place, and by currying against decision makers such as Vitalik and imitating their values.I see those “blessed” by Vitalik enjoying wealth privileges without being held responsible, and those in poor situations (including those who work hard) can never stand up.
I don’t want to talk too much about personal experience, but the foundations in my eyes are extremely confused: the leadership is not sure about the number of subordinates, the salary of doctoral contributors is only $25 per hour, the salary of employees is often delinquent, factional struggles and power scheming are rampant.I made many enemies because I said bluntly.
I know many top talents who left the foundation/Ethereum ecosystem for similar reasons; I have also seen talented people who tried to join but were rejected.Some people encounter institutional problems similar to foundations; some people cannot find well-functioning Ethereum projects and end up seeking a higher salary; some people turn to other places due to unfair rewards; and some people are persuaded to withdraw from the chaotic and slow progress.
There are countless typical cases.I think the best case is Ethereum “derivative” projects like NEAR and Monad.Why do these projects exist?Why do those talented founders choose to start a new business without building Ethereum?Why do investors invest in competitors without investing in Ethereum?
How the Web2 economy works is worth referring to: builders who want to develop better search engines have two options – join Google (will be rewarded if they have outstanding capabilities) or start a company (which may be acquired by Google).Either way, builders are rewarded, and innovation is ultimately integrated into the Google ecosystem.
Ethereum has neither capability: foundations and other organizations cannot provide preferential treatment including equity reciprocity to underlying contributors; mergers and acquisitions almost do not exist.In short, the economic model is broken: Ethereum cannot compensate the founders of taking risks and innovation at the bottom.The salary of foundation R&D personnel is much lower than that of establishing their own businesses or joining competitors.In the face of criticism, the foundation always argues that its brand halo is enough to make up for the lack of risk rewards.
Even if the community supports attracting NEAR/Monad builders (who implemented and improved the Ethereum roadmap several years ahead of schedule), there is a lack of implementation mechanism: neither a funding nor an executive body.So the most ambitious builders are forced to become competitors—even if they wouldn’t have wanted to.
This can’t be overemphasized on Ethereum.NEAR implemented the original Eth2.0 roadmap such as sharding when Ethereum failed, which could have been released as Eth2.0.Now Monad is reappearing this scene – it is already ahead of Ethereum’s technology for two entire generations and could have been used as Eth3.0.Although NEAR/Monad’s decentralization is not as good as the Ethereum main network, it is far superior to the existing Rollup, supports higher throughput, and is an excellent expansion solution (described in detail later).Imagine that Ethereum can keep up rather than lag behind these projects is both fun and sad – this profoundly reveals its economic and governance issues.
It needs to be clarified: there are still a large number of talents struggling for Ethereum, and I am not denying this.Ethereum still has the advantage in talent reserves, but we need to pay attention to the rate of change rather than the status quo.Its talent advantage is shrinking, and I think it is difficult to sustain.Inertia alone is not enough.The halo of “Ethereum R&D” does exist (or exist), but the reasons described in this article are gradually making it dim.
Under the current ecological state, talent is still a zero-sum game – the loss of Ethereum is the harvest of competitors.I have witnessed a large number of talent outflows: many capable people have turned to other places, and those who stayed are also frustrated and considering leaving.If we want to remain competitive, Ethereum must completely restructure its talent pipeline.Why do talents join Ethereum now?Why stay when the treatment is better elsewhere?
Among the issues described in this article, the talent crisis is my biggest concern about Ethereum’s future.Any successful founder understands that talent is the lifeblood of the project.Once the blockchain ecosystem loses talents, it is difficult to reverse.Ethereum is still an industry leader at present, but as we are common – even a successful blockchain ecosystem may suddenly decline.Ethereum should do its best to avoid this fate.
If we had a more mature governance system and talent incentive system – that is, the basic skills that successful startups have done to maintain competitiveness – Ethereum would have solved this problem long ago.
2. User experience split
In the previous article, I briefly mentioned the availability of Ethereum, especially in the context of its obsession with research and pursuing ideological purity while ignoring practicality.Although Ethereum always has (and still exists) many availability flaws—key management, final confirmation time, cold start issues—in my opinion, the most serious problem is the split experience caused by the complex Rollup ecosystem.
Recalling the travel experience 20 years ago: it is almost impossible to move forward after arriving in a foreign country.The phone cannot be used (not solved by installing local eSIM nowadays). Due to the lack of global roaming standards, you need to equip your phone with different standards in different regions.Credit cards are invalid and there is no induction payment. You must take a traveler’s check to the local bank to exchange local currency before you can spend it.Of course, there is no translation software or map application, everything needs to be done in the original inefficient way.
This is a portrayal of the current transaction experience of Ethereum (if the entire Rollup ecosystem is regarded as a whole).You need to manage dozens of accounts scattered across multiple wallets, each with unique design flaws and none of them are easy to use.Each Rollup and L2 chain has exclusive Gas tokens, which is difficult to clarify.Even if ETH is used as Gas, it is not easy to transfer ETH between different chains with the same address.Even for experts, remembering “what wallet has which apps have which accounts” is crazy and extremely error-prone.
Worse, cross-chain bridges are disasters: unreliable, unsafe, highly charged and long-term (is it much like a traveler’s check?).In fact, most people are forced to use centralized exchanges such as Coinbase or Binance as fact cross-chain bridges.This sounds bad and centralized – but don’t forget that not only is the cross-chain bridge centralized, Rollup itself is also centralized by small “security committees” (essentially friends groups), who can shut down chains or review transactions at any time like an exchange.This completely goes against the core philosophy of cryptocurrencies.
The situation is still getting worse.The lack of seamless transmission of data/assets between chains leads to extremely fragmented liquidity.The stupidest way to design a scalable system available is to deploy exactly the same but incommunicable applications on every shard—and that’s exactly where Ethereum is: projects like Aave and Uniswap are deployed on dozens of chains, with liquidity, users and data being fragmented.This kind of experience is simply impossible to attract new users.
This situation could have been avoided.We always take these user experience issues for granted and always dispel complainers as “nothing who doesn’t understand the principles of blockchain” – this kind of arrogance is wrong because the responsibility lies with us.These problems are neither inevitable nor terminal illness, but design decisions we choose actively.We could not have taken this path, and now we still have room for improvement.
Ethereum has its own reasons for choosing this path: expanding the basic layer in a lazy way.It was made clear as early as 2017 that the Ethereum basic layer can never meet transaction needs.The original plan was to shard the basic layer into dozens/hundreds of the same shards, so that account transactions can be carried out asynchronously across shards.NEAR’s perfect sharding design has verified the feasibility of this solution – most of the complexities can be hidden from users and even developers, and users do not need to know the sharding where the account is located.Sharding is by no means a new concept, and all mature scalable systems (including web servers and databases) have been using similar solutions for many years.
But Ethereum chose a lazy solution: only implementing the Eth2.0 roadmap for the first two stages, it abandons sharding and instead allows others to expand by deploying heterogeneous L2 chains (Rollup).This is the “Ethereum Way”: choose the most open and decentralized (i.e. the least required for centralized coordination or vision planning) solution, and leave the rest to the market.
A few years later, the market gave the answer: dozens or hundreds of competitive chains and standards emerged, and new projects were born almost every day.It is not just users, applications and mobility that are separated, but also community attention.A large number of well-known L2 projects compete for attention rather than co-building a unified vision, and the lack of global interoperability standards have led to the UX disaster described above.The Ethereum Foundation and roadmap makers should have set basic rules and standards, but failed to perform their duties.
Ethereum advocates often criticize high-throughput chains such as Solana, saying that only modularization (rather than blindly increasing single-node throughput) can be achieved.They are right, but the existing solution is by no means a correct solution.
The Ethereum community has just begun to realize the seriousness of the problem, but most people are still escaping reality.When I point out the chaos, the most common response I hear is: “Don’t worry, an interoperability project is coming soon and completely resolves the problem.” I have listened to this commitment for years, but have not seen any trusted project that can substantially improve UX (rather than introducing more complex centralized risks).I’ve seen too many failed attempts and know that the problem is rooted in the lower level.Unless the current wrong extension model is abandoned and moves to more rational design, Ethereum will lose its competitiveness.
The best interoperability solution at present is NEAR’s Intents system, which allows the control of multi-chain assets through a single account.After it matures, it may be able to relieve the splitting problem by automatically adjusting the liquidity.However, Intents aims to achieve heterogeneous ecosystem interoperability such as Bitcoin-Ethereum-Solana-NEAR, and cannot fix the internal problems of the EVM ecosystem alone.
The only reasonable way out is to return to the concept of sharding.This idea is gradually emerging with proposals such as “Native Basic Rollup” (essentially similar to sharding).I’m not sure if the Ethereum ecosystem can coordinate a real solution (which requires strong leadership and deep change), but it’s definitely worth trying.
3. Governance issues
The previous article has mentioned some of the operational dysfunction of the Ethereum Foundation (EF), at least I experienced it a few years ago.Although I am not sure about the current situation of the Foundation, I keep hearing similar chaos stories from friends and acquaintances.
The above problems are actually a sign of deeper stubborn diseases.This indicates a systemic condition when an organization cannot retain talent, cannot fairly compensate contributors, and the wrong candidates are promoted to power positions.For the Ethereum Foundation, one of the core problems lies in the governance structure.As Vitalik recently admitted, he always has substantial control over the foundation—even though the foundation has three board members, Vitalik has three votes to form de facto dictatorial control.If this situation changes, no public statement will be found.
The fundamental problem with the foundation is the lack of accountability mechanisms.Vitalik is not responsible to the board of directors, and because of its non-profit nature, there are no shareholders who can intervene incorrectly (even if the situation is so bad).Unlike traditional nonprofits, foundations and their boards are not even responsible for donors.Vitalik is certainly an outstanding technology leader, but the problem is not personal competence—any organization lacks transparency and accountability is doomed to fail.
In this lack of supervision, power often flows into the hands of ambitious people, which is what I saw with my own eyes at the Ethereum Foundation.This situation is a disaster for any organization, and it is even more ironic to the Ethereum Foundation, which is at the core of the crypto ecosystem of “building a fair and transparent human system”.This hypocrisy is the main reason why I left Ethereum – it keeps me awake at night.
The Ethereum Foundation had a strong leader Ming Chan during its inception, but she made many enemies with her tough style.In the end, decision makers such as Vitalik terminated their cooperation because they had difficulty controlling her.During my time at work, I witnessed many independent and vocal officials being fired for such reasons.
Successive executive director Aya is completely opposite to Ming: he has strived for stability in the past seven years, but he is by no means a changer.Faced with fierce criticism, the foundation has recently hastily implemented a dual executive director system and appointed Tomasz Stańczak and Hsiao-wei Wang to jointly lead.Despite their good character and sincerity in reform, I doubt this structure will bring about substantial changes: Hsiao-wei was a researcher rather than a bureaucratic leader (this is the main reason for the foundation to fall into the status quo); Tomasz had full authorization or could promote reform, but his intuition told me that he would have difficulty obtaining permission to implement difficult changes.The Ethereum Foundation is likely to continue to stagger and become a negative benchmark for the Ethereum ecosystem for a long time.
This could have been avoided.The Ethereum Foundation’s plan was to dissolve after the ecosystem matured—a number of foundation founders confirmed to me that it should be just a short-term booster.The foundation was indeed critical in the early days, but now it is more of a hindrance than a catalyst.The dissolution of the foundation will create space for more teams to take responsibility.
You may be wondering: Why not bypass the foundation to advance affairs?In fact, dozens of well-funded organizations have been independently promoting Ethereum R&D and community construction.But the problem is: despite the obvious flaws of the foundation, its huge resources and authority still make it difficult to challenge in formulating a roadmap; at the same time, these organizations are mostly for-profit companies, and their vision of governing is exactly the root of ecological fragmentation.Public goods projects like Ethereum require at least credible neutral coordination entities such as the Linux Foundation and W3C to set standards – although these organizations are not perfect, they at least have accountability mechanisms.
If the Ethereum ecosystem wants to regain its strength, it must begin to explore the collaboration path to bypass the Ethereum Foundation.Ethereum’s development achievements in recent years have stemmed from grassroots efforts rather than from the leadership of the foundation.The emergence of emerging organizations such as Etherealize marks the beginning of this attempt, but it is probably too late.The complexity of the problem is that the Ethereum community has never been able to open an honest discussion on the foundation issues, and this silence itself has signaled a deeper crisis.Unless there is a change, Ethereum will continue to struggle.
(Note: The views in this article are only the author’s personal views)
