"I feel like I am a somewhat useful fool for the Ethereum Foundation." On October 19, 2025, an open letter written a year and a half ago was published on Twitter, instantly igniting discussions within the crypto community.
The author is not some fringe critic, but Péter Szilágyi—former head of the Geth client, which maintained over 60% of Ethereum's nodes, and a core developer who has worked in this ecosystem for a full 9 years.
At the same time, blockchain data showed that the Ethereum Foundation had just completed a large transfer of ETH worth $654 million, moving 160,000 ETH to a wallet that had previously been used for sales.
The collision of ideals and reality, the intertwining of beliefs and interests, and the concentration of power under the banner of decentralization all constitute the profound crisis currently faced by the Ethereum Foundation.
01 Trigger Point: The "Resignation Letter" Delayed by 18 Months
This letter, written in May 2024, was initially circulated only within the leadership of the Ethereum Foundation but was suddenly made public a year and a half later in October 2025.
The timing is quite intriguing—coinciding with the Ethereum Foundation being under scrutiny due to large asset transfers.
Péter Szilágyi candidly expressed in the letter his confusion and pain over Ethereum and his role in the Foundation over the years. He described himself as a "useful fool," revealing the significant gap between the Foundation's public statements and its internal actions.
Even more shocking is that during the first six years of his work at Ethereum (2015-2021)—when ETH's market value rose from $0 to $450 billion—his total income was only $625,000, with no equity or incentives.
02 The Dilemma of Idealists: The "Leadership Role" Being Exploited
Szilágyi painfully described being assigned a "perceived leadership role" within the Foundation. Whenever there was a controversy within Ethereum, the Foundation would have him, the "troublemaker," stand up to oppose it, to showcase the Foundation's "democracy" and "inclusiveness."
He wrote: "I could choose to remain silent and watch Ethereum's values be trampled; or I could speak out, but gradually ruin my own reputation. Either way, the result is the same—Geth would be marginalized, and I would be excluded."
This lose-lose dilemma reveals a harsh reality: behind the ideal of decentralization lies a subtle manipulation of power by the Ethereum Foundation.
In June 2025, Péter Szilágyi ultimately left the Ethereum Foundation. Reports indicate that he rejected the Foundation's proposal of $5 million to spin off Geth into a private company, choosing to leave entirely rather than turn ideals into business.
03 Systemic Dilemma: Low Salary Culture and Protocol Capture
Péter Szilágyi's experience is not an isolated case. He revealed that nearly all of the Foundation's early employees had already left, "because that was the only reasonable way to obtain compensation commensurate with the value created."
He sarcastically quoted Vitalik: "If no one complains about their salary being too low, then the salary is too high."
The low salary culture has serious consequences. Those who genuinely care about the protocol's development, due to meager income within Ethereum, are forced to seek external sources of income, leading to various conflicts of interest.
Szilágyi pointed out: "The Foundation systematically depresses the compensation of those who truly care about the protocol, forcing the most trustworthy individuals to seek compensation elsewhere." He bluntly stated that Justin and Dankrad's recent advisory positions are a direct result of this policy—despite the obvious conflicts of interest, their acceptance of funding is understandable.
04 Power Structure: Vitalik and His "Circle of Friends"
Szilágyi sharply analyzed the power structure of Ethereum in his letter. He expressed respect for Vitalik himself but pointed out an unavoidable fact:
"Whether Vitalik wants it or not, he unilaterally decides the direction of Ethereum. Where Vitalik's attention goes, resources follow; what projects he invests in succeed; what technical routes he endorses become mainstream."
More critically, a 'ruling elite' circle of 5-10 people has formed around Vitalik. These individuals invest in each other, serve as advisors, and control the resource allocation within the ecosystem.
New projects no longer conduct public fundraising but instead directly approach these 5-10 individuals. Securing their investment is tantamount to obtaining a ticket to success.
05 Chain Reaction: Collective Voices of Ecological Giants
Less than 24 hours after Péter Szilágyi's letter was made public, Polygon founder Sandeep Nailwal stepped forward to express his frustration.
As one of the largest Layer 2 projects on Ethereum, Polygon has made significant contributions to Ethereum's scalability. However, Sandeep complained that the Ethereum community has never truly accepted Polygon.
He pointed out a strange double standard: "When Polymarket succeeds, the media calls it an 'Ethereum victory.' But Polygon itself? Not considered Ethereum."
Even more shocking, Sandeep revealed that if Polygon announced itself as an independent L1 rather than Ethereum's L2, its valuation could immediately double or quintuple. But out of moral loyalty to Ethereum, he did not do so—even though this loyalty could cost him billions in valuation.
Also speaking out was DeFi legend Andre Cronje. He puzzled, "If money hasn't gone to core builders Peter and Geth, nor to the loudest L2 supporters Sandeep and Polygon, where has the money gone?"
06 Foundation Transfer Doubts: Timing and Motivation of Large Asset Transfers
While the community was still digesting these internal criticisms, blockchain data revealed new developments—the Ethereum Foundation transferred 160,000 ETH worth $654 million to a wallet marked by Arkham Intelligence as previously used for sales.
Hsiao-Wei Wang, the Foundation's co-executive director, quickly explained on social media that this transfer was part of a planned wallet migration.
However, such an explanation seemed weak to the community. After all, this was not the first time the Foundation had sparked controversy due to large transfers:
- In July 2024, the Ethereum Foundation transferred 3,631 ETH worth $12.5 million to Kraken exchange.
- In October 2024, another wallet associated with the Foundation transferred 1,250 ETH worth about $3.03 million to Bitstamp.
- Throughout 2025, the Foundation executed multiple ETH sales through CoW Swap, totaling about 36,000 ETH.
07 Foundation's Crisis Management: The Gap Between Transparency Promises and Actual Actions
In the face of growing skepticism, the Ethereum Foundation had previously promised to improve financial transparency. In September 2024, the Foundation announced plans to release a detailed financial report to address community concerns about its spending behavior.
Ethereum researcher Justin Drake revealed in an AMA that the Foundation's main wallet holds about $650 million, with a budget sufficient to sustain operations for about ten years.
Vitalik Buterin himself had also explained the Foundation's budget strategy on Reddit, roughly spending 15% of the remaining funds each year. This approach means "the EF will always exist, but as part of the ecosystem, it will become smaller over time."
However, these efforts have not fully alleviated the trust crisis. Especially after Szilágyi's letter was made public, the community's questioning of the Foundation's use of funds intensified.
08 Structural Contradictions: The Ideal of Decentralization vs. The Reality of Power Concentration
The Ethereum Foundation faces not only a trust crisis but also a structural contradiction between ideals and power.
Szilágyi lamented in his letter: "We wanted to create a world of equality, but now the most successful projects are supported by the same 5-10 people, and behind them are the same few venture capital firms. All power is concentrated in Vitalik's circle of friends."
He pointed out that the direction of Ethereum's development ultimately depends on one's relationship with Vitalik. "It's actually quite simple: people are always more lenient towards friends than outsiders—so to succeed, befriend the 'kingmaker.'"
As for himself, Szilágyi stated: "And I choose to keep my distance because I find it disgusting to build friendships for monetary gain."
09 The Game of Power and Ideals: Ethereum at a Crossroads of Fate
In June 2025, the Ethereum Foundation announced layoffs and a reorganization of its core development team, focusing on scaling the protocol, increasing blobspace, and improving the user experience of Ethereum.
The Foundation also shifted to a funding strategy driven by DeFi lending yields, rather than its traditional method—selling Ether on the open market to fund operations.
However, whether these reforms can resolve the systemic trust crisis remains an unanswered question.
At the end of his letter, Péter Szilágyi expressed deep fatigue and confusion: "I feel that in Ethereum's grand blueprint, Geth is seen as a problem, and I am at the center of that problem."
He has turned down countless high-paying offers over the years because he believed in the ideals of Ethereum. But now the entire ecosystem is saying, "This is just business." He cannot accept this mindset but also sees no way out. Ultimately, Péter Szilágyi completely left the Ethereum Foundation in June 2025.
This choice is quite symbolic: in the struggle between technological idealism and capital logic, another core builder chose to uphold ideals, even at the cost of leaving the project he had devoted 9 years of effort to.
On one side is the disillusionment of core developers, and on the other is the Foundation's massive capital operations—in this collision between idealism and capital reality, we must ask: where exactly has Ethereum's original intention been lost?
Appendix: Péter Szilágyi's Exposé Text: https://gist.github.com/karalabe/a2bc53436f29e0711fe680d59e180f6c
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