Ethereum: Why So Many People Are Giving Up on It

Añadido: 2026-05-30

[00:00:00]Ethereum is facing one of its biggest crisis of confidence.

[00:00:03]It continues to underperform.

[00:00:05]Prominent Ethereum Foundation researchers have resigned, and critics accused the organization of being out of touch.

[00:00:11]People who are saying the EFF should be responsible for the price of ETH and saying, no, that's not what we're responsible for at all. If it gets way too low, then it would be a problem.

[00:00:22]Even more bearish.

[00:00:23]One of Ethereum's most prominent advocates, David Hoffman, recently announced he had sold all of his ETH holdings.

[00:00:30]He bought Zcash and near tokens.

[00:00:33]Those are ecosystems that are much earlier in their development and their blossoming than Ethereum has been.

[00:00:39]So what does all this mean for Ethereum? Is the ecosystem dying, or could this wave of pessimism be signaling a classic buying opportunity to find out, we talked to Hudson Jameson, Ethereum expert and former member of the Ethereum Foundation.

[00:00:53]Before we get started, don't forget this interview is just for educational purposes and does not represent financial advice.

[00:00:59]Also, if Also, if you enjoy our content, don't forget to like and subscribe to our channel.

[00:01:03]I'm Giovanni. Let's get started.

[00:01:07]What is your view on the disconnect between the price of ETH and the expansion of the Ethereum ecosystem?

[00:01:15]Sure. So I would first say I feel like markets are very irrational.

[00:01:21]Um, over the years I've seen different technologies with absolutely no promise and no nothing good under the hood. Rise up and get into the top 50 of coin market cap, while other ones who have a lot of promise and have a lot of good technological feasibility, uh, not be able to go anywhere because of bad marketing, you know, the timing being bad market conditions.

[00:01:43]So we're in a bear market right now and, uh, ETH is down from its all time high by a good bit.

[00:01:50]But I don't think that that means that anything about the technology or the adoption is bad.

[00:01:56]Sometimes it can just be that everything else in the crypto ecosystem for markets is down.

[00:02:02]So I generally don't look at the price of ETH as an indication of adoption or as an indication of how well the technology is operating or being developed. Those are, to me, are two very separate things.

[00:02:17]Um, it's great that we're having a bunch of institutional adoption with rwas and things like that. And I think that's going to continue.

[00:02:23]There are also other people who think that the price of ETH is very important. Um, for example, one of one of the latest big news is that David Hoffman, who was one of the most prominent voices within the Ethereum ecosystem, announced that he sold his ETH.

[00:02:41]And basically he posted an explanation for for that.

[00:02:46]He said, quote, I'm incredibly bullish on Ethereum and the network and its ecosystem. Ethereum is architecturally designed to maximize success for its apps, L2 and ecosystems.

[00:02:56]The fat app thesis means Ethereum's apps take all the fees, and the rollup centric roadmap means that L2's take 97% margins. As for ETH, the asset, I have a harder time seeing ETH being structurally rerated in any direction, up or down.

[00:03:14]Being incredibly optimistic on Ethereum, the network.

[00:03:17]He doesn't see if the asset as something that can go up in price significantly. What are your what is your thought on this?

[00:03:25]Sure. So I've known David for a really long time. I'm kind of glad that he came out and spoken this way, because I think that it started really good conversations around how people are relating ETH, the asset to Ethereum, the ecosystem, and starting to better make that separation. Um, when it comes to if he's right or wrong, I, I think that he's wrong.

[00:03:49]I think that the price of ETH will go up eventually, but at the same time, I don't know when that will happen. That's all about those irrational market conditions I was talking about where, you know, if like Bitcoin is going up, there's a correlation where other coins are going to raise with the tides of Bitcoin going up. Um, I think that the network and ecosystem and Ethereum as a, like a community, the fact that he's bullish on that is really good. Um, I agree with him on that for sure. There's a lot to look forward to, a lot of really awesome, um, uh, research and development that's happening behind the scenes, uh, when it comes to making the network faster and more efficient. Uh, AI is speeding up a lot of the research efforts from our researchers to do things like make Ethereum quantum resistant.

[00:04:38]Um, and so I think that, yeah, there's reason to be bullish for all those things when it comes to like what other assets to take.

[00:04:47]Though David made a comment on one of the Twitter threads that instead, when he sold his ETH asset, he bought Zcash and near tokens, which I found really interesting because like those are ecosystems that are much earlier in their development and their blossoming than Ethereum has been. So it is a really good thing to bet on those projects.

[00:05:10]And they are.

[00:05:12]They do have really good technology and really good thesis.

[00:05:15]So really, I mean, David is directionally right?

[00:05:19]I think it just caused a lot of drama due to the way it was worded and also due to the fact that it's David Hoffman is one of the prominent voices in the ecosystem.

[00:05:28]Being told that I'm selling all my ETH can kind of indicate that you're giving up on the project as a whole, when in reality, he's giving up on some of the financial theses as they relate to the technological progress of Ethereum.

[00:05:41]Probably a lot of people would say that this is very bearish for for if the asset if one of the prominent voices sells everything.

[00:05:51]Mhm. Um, but let's talk about the Ethereum Foundation. Serum Foundation is facing a lot of criticism again.

[00:05:58]So of course, it's not like the first time it's been a couple of years that Ethereum Foundation has been under a lot of criticism.

[00:06:05]But right now we are seeing that a lot of senior people within the Ethereum Foundation announced they are leaving dandruff faced.

[00:06:14]One of the most prominent Ethereum researcher suggested that the Ethereum Foundation should be replaced with a new structure that would ensure that the price of ETH will go up and essentially help, quote, save Ethereum.

[00:06:30]What do you make of this idea?

[00:06:33]Yeah, so great questions.

[00:06:35]So the Ethereum Foundation has had a long history of criticism against it, some of it for good reason.

[00:06:43]Um, I think what it comes down to at the end of the day is sometimes poor communication on behalf of the leadership, except for Vitalik, some of the time Vitalik did make a Twitter post in response to some of the criticism recently that I think addressed a lot of the key points about how the Ethereum Foundation, what the direction would be, and the thing that people don't realize about the Ethereum Foundation was before the last six months when they came out with the EFF mandate, which I'll talk about in a second.

[00:07:12]There's really been a back and forth on what the role of the Ethereum Foundation is to be at the beginning of all of this. Back when I was working there, it was one of the few major entities at all for Ethereum, so it had to do a lot of the steering and a lot of the guidance.

[00:07:26]But I think that now it's like there's so many other organizations and so many other people that are involved in this whole blooming Ethereum ecosystem that the Ethereum Foundation can take a step back in a way, and not have to be in charge of everything. And that's been the case for a number of years, with them stepping back slowly from their different parts of the ecosystem.

[00:07:51]It's kind of crazy to say that the EFF should be doing research, development, testing, security, BD, uh, marketing, uh, just everything for Ethereum. Like it shouldn't be an everything organization.

[00:08:05]That's just too much stuff for one thing to do. It should be multiple organizations and the Ethereum Foundation all coming together to work together on these separate things. And each area of expertise going to the organization it belongs to. Um, there are organizations in the past such as Consensus and Gnosis that have done this. Uh, but it never really stuck long enough for, um, it's a really become like a permanent solution.

[00:08:32]Um, there's still in the ecosystem and they're still helping a lot, but there needs to be a more formal structure for these major organizations to all come together and take on their piece of the pie. So as far as what, um, the people leaving the Ethereum Foundation, the prominent researchers, I don't have direct insight into why each of them left beyond what they've said publicly.

[00:08:54]I think that during an organizational change, like a new co-director coming in, Bastian is the new co-executive director of the Ethereum Foundation along with Xiaowei.

[00:09:05]Whereas before it was Tomash.

[00:09:07]Um, the new director coming in can sometimes cause people to reevaluate where they are in their careers and just use that as a good time to leave.

[00:09:16]So I think that is probably a lot of what's happening. There might be some disgruntled employees.

[00:09:22]I do hope they speak out if that's the case. Uh, but, uh, we don't really know for sure.

[00:09:26]So we can only speculate based on, you know, criticism and people coming up with ideas, uh, talking about, um, the new, um, like a new structure or a new organization to replace the Ethereum foundation.

[00:09:41]I love the idea of the organization that he's talking about that would pump the price of ETH potentially or like do things to make, uh, you know, the Ethereum more like accessible to enterprises and all this other stuff that he kind of mentioned in the thread, but I don't think it should replace the Ethereum Foundation. It should complement it. Ethereum Foundation should do what it does best, which is some coordination task around the core protocol development, core protocol testing, security, and like, uh, some legal stuff around the copyright and trademarks of Ethereum itself.

[00:10:17]Beyond that, there should be other organizations helping.

[00:10:19]And I do hope that they come together and things are formed, like what Dave Grant said, to help the Ethereum Foundation become less centralized.

[00:10:27]Do you think that the Ethereum Foundation should be held accountable for the lackluster price action of ETH?

[00:10:36]Definitely not.

[00:10:38]The EF mandate, which I alluded to earlier, was something the Ethereum Foundation put out.

[00:10:42]And it's a really interesting document that talks about what role the Ethereum Foundation plays in the ecosystem. And in short, they talk about this acronym called crops, which is censorship resistance. Well, let's see, I wrote it down here. Crops was censorship, resistance, openness, privacy, and secure systems.

[00:11:01]So they basically want to only work on things that align with those core ethics and pumping the price of ETH, or making sure that ETH is like doing well isn't something that's in that mandate. So they basically are trying to rip the band aid off of people who are saying the EFF should be responsible for the price of ETH and saying, no, that's not what we're responsible for at all.

[00:11:24]Uh, in fact, the only reason the Ethereum Foundation would want to be responsible for the price of ETH as if it affected the security of the network, which at this point is not anywhere near happening.

[00:11:35]A lot of people are saying, okay, well, you are not responsible.

[00:11:38]You don't want to take care of the price because you are.

[00:11:41]Your mandate has to do with this more fundamental things like censorship, resistance, decentralization, and security of the network.

[00:11:50]But people would say that the price of the asset is pivotal, is fundamental for guaranteeing the security of the network.

[00:11:59]What is your take on this?

[00:12:01]I think the price is important for the security of the network, but I think it is within a range where if it gets way too low, then it would be a problem, but that would have to get, in my opinion, thousands of dollars cheaper to be able to come to a point where we say, oh, there's a real problem with ether being too cheap to buy, but then at the same time, once it gets too cheap to buy, like cheap enough for an attacker to try to get enough ETH to attack the network, that would cause the price to rise, because they're trying to use all available liquidity outlets to buy that much ether.

[00:12:37]So the the problem would be, theoretically, if the price got low enough, an attacker could buy enough ETH to attack the network, but there would have to be a like an organization or person who would want to do that in the first place.

[00:12:53]And number two, if they try to do that, the price would rise.

[00:12:57]So it's a very slim chance of that happening. I think people who are using that as an excuse don't understand the fundamentals of how Ethereum staking works.

[00:13:07]I have another criticism here this time is from Laura Shin, who is also a very prominent voice in the Ethereum ecosystem. She wrote a book about Ethereum.

[00:13:16]She's a big expert.

[00:13:18]She argued in a thread that Ethereum's tokenomics issues are not being addressed seriously enough. She said, quote, the Ethereum Foundation seems to want to sit back on its laurels and act above it all, while all its competitors are getting down and dirty on the field to gain market share. So, uh, what is your reaction to that criticism?

[00:13:40]Do you think it's fair to say that the tokenomics of Ethereum should be addressed.

[00:13:46]I think the tokenomics of Ethereum should be addressed by someone other than the Ethereum Foundation.

[00:13:51]They're not the right player to do that. Like you wouldn't go to a daycare and ask them how to run a high school. Like they're there for being a daycare and for taking care of children under the age of five or whatever. So you don't go to the Ethereum Foundation saying, hey, hey, hey, how do you deal like, help us pump eath, help us make it like a big thing.

[00:14:12]And like, that's just not their edict. That's not their mandate.

[00:14:17]Something else would be, I don't think they would do a good job at it. I think the Ethereum Foundation doesn't know how to do that correctly.

[00:14:23]They don't have the people on staff to do that, and they don't have the budget long term to hire people over a number of years to do that as well.

[00:14:31]Their budget is shrinking.

[00:14:33]Their, uh, centralization is shrinking, uh, how they like determine what they're doing.

[00:14:40]Their mandate is causing their abilities to shrink.

[00:14:43]All of that is culminating in this new Ethereum foundation that we finally have clarity on where other organizations need to pick up the, um, the mantle on the tokenomics and maybe some of the things like mass adoption. Um, Ethereum, ethyl ether, I think is the name of the company is, uh, a great organization that has, uh, Vivek and Danny Ryan in it.

[00:15:09]And they do a lot of great things for enterprise and non enterprise adoption of Ethereum. And that's just one of the organizations that comes to mind that could do something like this.

[00:15:19]I think Laura worded it how she did because she needs clicks as just as anybody who's in media does.

[00:15:26]So I wouldn't take it too seriously that she's saying that, you know, everything's on fire and we need to gain market share.

[00:15:35]I think that if the organizations that know how to do that come together, we will gain market share because that is important in some ways.

[00:15:43]But overall, I, I think it's a little bit overblown.

[00:15:48]Many people are criticizing the tokenomics of Ethereum.

[00:15:51]All the revenue is being absorbed by layer twos. And essentially the base layer, uh, captures a very small percentage of the overall value flowing into Ethereum, the network. I think that's also what potentially Laura was talking about when he said that the tokenomics of Ethereum should be improved.

[00:16:14]In that sense. You don't agree with that.

[00:16:16]I think that it's overblown, but there are portions that I do agree with. What's very interesting that you mentioned was the L2 element of it. So basically would layer two protocols, take some of that value from layer one. And I think there is an argument to be made that that is happening or could happen.

[00:16:34]Um, what's interesting is the layer two thesis has changed since it started. So whereas before layer twos were built to be general purpose, meaning they were just copies of Ethereum basically, and were used to relieve network congestion on Ethereum. Now they're starting to be a like direction where an L2 is specifically designed for a certain use case or a certain like area of the ecosystem.

[00:17:02]So maybe gaming or like, uh, prediction markets or, uh, certain areas of DeFi and finance, like stuff like lighter.

[00:17:11]Um, so I think that with that, that actually doesn't take away from the economics of Ethereum, but it has the potential to, if L2 get big enough, if everybody is just using L2.

[00:17:26]I can see that that can become a problem where there's a lot of, um, generation of wealth happening on the L2, and the L1 isn't getting as much benefit from that.

[00:17:37]I do think that like.

[00:17:41]Both the L1 and L2 would benefit from that in the short term.

[00:17:45]I just don't know about the long term.

[00:17:46]That's that's the thing where when Laura's talking about that and that specific thesis, I think that there is some relevance to that for sure.

[00:17:55]And now just a final question regarding, again, the performance of the asset. So you mentioned at the beginning of the conversation that much, a lot of it depends on the broader sentiment in crypto that essentially we are in a bear market.

[00:18:10]But on the other hand, I could say that other crypto assets, like for example, Bitcoin, but also Solana, they overcame their previous all time highs in the in the in the last cycle.

[00:18:25]Unlike those assets, uh, it never got to match the 2021 price action.

[00:18:32]And that is sort of disheartening for many people to see. Do you have any idea of why that is the case.

[00:18:39]I think that Ethereum is misunderstood and the narratives that are developed for it, compared to things like Solana and Bitcoin, are harder to grasp.

[00:18:49]Um, I think that Ethereum has strong fundamentals and a strong technology, but it's a generalizable blockchain. Whereas Solana focuses a lot on finance. And that's very easy to understand out of the gate.

[00:19:03]Bitcoin store of value transfer of value use cases.

[00:19:08]All it really has unless you're talking about their side chains or things like that. And so those are very easy for consumers to grasp when they're deciding what to buy. As far as tokens go, Ethereum might be a little bit more difficult to understand just because it's generalizable.

[00:19:24]And we're doing things with smart contracts and with use cases that other, uh, chains aren't doing or aren't focusing on.

[00:19:32]So it's kind of like when there's too much going on that can cause confusion to people who are wanting to, um, invest in the asset.

[00:19:41]So, uh, I think that over time, hopefully the narrative will become more clear as to why Ethereum is important, what it can be used for, and there's more use cases launching on it, um, including things like prediction markets and stuff that's, uh, very popular right now and use cases we can't even think of happening in the future that will affect the price of ETH, the asset, because people will see just how great Ethereum is.

[00:20:10]Well, right. Hudson, thanks again for joining our show.

[00:20:13]It was a great conversation.

[00:20:15]Thank you so much.