I believe that Ethereum’s social layer is broken. I believe that there are serious issues with the way this ecosystem currently operates — not at the protocol layer, but at the people layer. My goal with this post is to highlight some of the issues I personally have witnessed, but I will confess that my view of the ecosystem is obviously imperfect. I am open to all challenges to the claims I make below, and I also encourage others to share their own feedback on Ethereum’s social layer too.
For too long our community has been told that these forums are meant to be a place of technical discussion, and that talking about the people layer is not a good use of this space. This makes sense, as conversations about people can quickly devolve into ad-hominem attacks on individuals themselves, vs structured and facts-based critiques of their actions. Nonetheless I think avoiding these discussions has eventually become a hinderance to the healthy functioning of this ecosystem and has led to significant capture and consolidation of power, and so today I’ll attempt to share some of what I’ve witnessed. To any individuals/groups I mention here specifically — I apologize in advance for singling you out — these issues are extremely widespread (far beyond the examples I mention below), but nonetheless my claims would fall flat without at least some substantiation. My hope is that anyone reading this will recognize that all of the people I mention below, despite my qualms with some of their actions, are good people who have helped build this ecosystem with mostly good intentions. Without them Ethereum would not be where it is today.
Finally I will say that I am certain that in writing this, the Mafia will turn to attacking me personally rather than the contents of this post. I hope that smart and well intentioned people can recognize these attacks as their own auto-poetic evidence the very issues I highlight below.
A Mafia: a highly organized, often opaque, network of individuals or groups who operate collectively to achieve mutual benefits, typically through informal or non-official means.
There are a number of characteristics which define a mafia, as compared with other groups:
- Shared Interests and Goals: Members align around common goals or mutual benefits, such as economic gain, power consolidation, or influence over a particular domain or system.
- Insularity and Exclusivity: These groups are usually closed to outsiders, requiring strong loyalty or specific qualifications for membership, often reinforced through rituals, oaths, or other forms of initiation or intimidation.
- Dependency on Obfuscation: Activities and goals are often hidden from public view, using secrecy and coded communication to protect the group’s interests and members.
- Informal Enforcement Mechanisms: Mafias rely on their own systems of rules, norms, and enforcement, including incentives like profit-sharing and deterrents such as punishment or ostracism, rather than relying on formal legal systems.
- Shadow Power Dynamics: While they often operate in parallel to formal institutions, mafias exercise significant influence over these institutions—whether through corruption, coercion, or indirect control.
- Adaptability: A mafia-style organization is highly adaptive, capable of evolving to meet the challenges posed by external pressures like law enforcement, competition, or social change.
- Focus on Power Accumulation: Beyond economic gain, mafias often aim to accumulate soft or hard power, ensuring influence over individuals, organizations, or governments.
I have never really been a part of any of Ethereum’s most important Mafias. For better or worse I was never invited; although I have many close friends who have been a part of them, at various levels. Nonetheless, I’ve been able to observe from the outside the way that these Mafias operate, especially when they act counter to the core values of Ethereum which I believe are extremely important.
The specific values which are antithetical to a Mafia’s operations are:
- Decentralization: Ethereum disperses power across a broad network of participants, ensuring no single entity can dominate or control the system.
- Transparency: Ethereum is built on the principle of transparency, with an open-source codebase and a public ledger that ensures all transactions and smart contracts are visible and auditable by anyone.
- Trustlessness: Ethereum eliminates the need for trust in individuals by replacing them with cryptographic proofs and automated, immutable smart contracts.
- Inclusion and Accessibility: Ethereum promotes open participation, inclusivity, and permissionless access, allowing anyone with an internet connection to interact with the network.
- Censorship Resistance: Ethereum is designed to be censorship-resistant, ensuring no entity can suppress or interfere with the actions of participants on the network.
- Collaboration and Open Innovation: Ethereum fosters open collaboration and innovation, encouraging a diverse community of developers, users, and entrepreneurs to build and grow the ecosystem collectively.
Since Ethereum’s inception, an incredible amount of work has gone into ensuring that the core technology/ protocol layer upholds these values, and I would say this work has generally been successful. However, this has occurred at the expense of upholding the same values at the social layer.
I believe that for a while, this was a healthy and necessary design choice. Ensuring the core protocol itself upheld these values is paramount, and I believe that the social layer is secondary to it in all respects. Even if we all go away, the core protocol can now continue operating in a manner that will perpetuate these values, and that is an outcome that everyone involved should feel extremely proud of.
However, now that the risk of protocol layer capture has gone down significantly, I believe that the biggest risk to Ethereum’s success heading into 2025 is the capture of various elements of our social layer. The way our social layer operates is currently extremely capturable (and is already showing signs of it), and is totally antithetical to the values outlined above. My goal in writing this post is to shine a light on some of the patterns I’ve witnessed over the years, in the hopes that sunlight and transparency can help harden this otherwise extremely weakened layer.
To begin I want to start by trying to define what I believe Ethereum’s social layer actually is, for the sake of fruitful discussion about one consistent thing (vs everyone having their own unique, irreconcilable definitions of it).
The social layer is made up of PEOPLE, who work for a number of different organizations within the Ethereum ecosystem. These organizations include:
- The Ethereum Foundation — the org charged with developing the core protocol and shepherding its growth.
- The Core Dev Teams — the plethora of organizations charged with building critical technology which enables Ethereum to exist and operate. This includes:
- Client teams — the groups which develop the actual software that nodes use to participate in the network.
- Layer 2 / scaling teams — the groups which develop extra-protocol solutions to help the base layer’s limitations on throughput and .
- Protocol R&D teams — the groups which perform research and help produce EIPs, to help evolve the protocol from its current form.
- Infrastructure and tooling teams — the groups which build the critical infrastructure and codebases which are required by developers to access data which lives on the core protocol, or develop smart contracts/dapps which live on the network.
- Security teams — the groups which audit the core protocol and smart contracts, as well as those who actively monitor the chain for attacks.
- Product teams — the groups building the end-user-facing platforms and products which real humans use to interact with Ethereum. This includes wallets, dapps, data platforms, etc. This also includes both the core orgs that develop these products, as well as the externalized DAOs which contribute to their continued existence.
- Social Coordination Teams — the groups charged with building and organizing the spaces where Ethereum’s social coordination occurs. This includes:
- Event Teams — the groups which host hackathons and conferences which are frequented by core members of the Ethereum ecosystem.
- Funding platform teams — the groups which build and administer the spaces where funding gets allocated to a plethora of teams building on Ethereum.
- Media/education teams — the groups which drive internal/external attention to various elements of Ethereum’s ecosystem, by regularly sharing content as broadly as possible on public social platforms.
- Social network teams — the groups which build and administer the digital spaces where conversation about Ethereum occurs.
- Investing Teams — the groups which invest capital into any/all of the above entities, in the hopes of maximizing their profits for their limited partners, as their fiduciary duty requires.
For a detailed list of specific groups which fit in the above categories, please copy my list into your favorite LLM; I’ve avoided sharing them explicitly here for the sake of brevity.
The most difficult thing about tracking a Mafia’s operations is that it often relies on an extremely interconnected web of personal/ private relationships, where influence is softly wielded (sometimes without people even needing to ask for it) by sub-groups of individuals who choose to align their goals with one another.
One of the most complicated elements of this in the Ethereum ecosystem is that there are now large entities (like ConsenSys, Paradigm, a16z, and Coinbase) which administer billions of dollars of capital, either internally employing many implementations of the above teams, or investing in them externally. These orgs (and others like them) wield enormous power by encouraging alignment among the teams they invest in, creating networks of power and influence which span across the entire ecosystem. These subgroups aren’t mutually exclusive with each other, which is why their individual power dynamics within the ecosystem are constantly shifting. The fact that there isn’t just one single such group but now at least 4 means that, just as in geopolitics, we live in a multipolar world, with these groups regularly competing amongst themselves to continuously rebalance against each other (either by co-investing or by funding competitors to drive margins and outsized power down). This has been a positive outcome for the ecosystem. But make no mistake — these groups still wield enormous power behind the scenes, and the individuals they invest in are well aware of who is on our side vs their side. “To learn who rules over you, simply find out who you are not allowed to criticize”. These teams are well aware, and they keep their mouths shut in order to avoid severe punishment from the various ingroups they’re members of. **
Importantly however, I want to point out that these groups are not the only mafias which exist in Ethereum. In fact they are probably not even the most powerful mafia groups in Ethereum, although they are the easiest to spot from the outside, which is why I listed them here.
You, the person reading this post, are likely part of at least one mafia-like subgroup, if not several. You have people who you call your personal friends, people who you’re in group chats with, who you stand by regardless of whether their actions are aligned with Ethereum’s core values or not. You drive any attention, capital, and social support to them, and you likely justify it by saying to yourself that you are simply investing in things which align with your personal values — you have skin in the game. And yet, in doing so, you are yourself participating in/helping to perpetuate a system which is completely antithetical to Ethereum’s values — you make these decisions behind closed doors, helping aggregate power and valuable resources to the people you know (at the expense of the ones you don’t).
Finally, and perhaps worst of all, I’ve heard stories about one specific “Ethereum Illuminati” — a self selecting group of individuals who are employed by a variety of different org types I listed above (including members of the Ethereum Foundation itself), which explicitly functions via the mafia mechanics I listed above, as if their very existence depended on it*.* Again I will state that groups like this are likely formed and operated with good intention, by well meaning individuals who want to see Ethereum succeed. However, like slowly boiled frogs, I believe they have become blinded to the enormous power which groups like theirs wield, and the attack surface that such operations are inevitably open the social protocol up to. Ethereum is weaker because of the existence of these fallback mechanisms, not stronger.
Above all of the values which I think our social layer has failed to uphold, the worst one of all is “can’t be evil”, a phrase which was commonly shared in the early days of Ethereum, contrasting Google’s “don’t be evil”. This core tenet emphasized the belief that human-administered systems are invariably open to capture, because at best humans aren’t perfect, and at worst valuable protocols will inevitably attract a long list of self-interested individuals who will do everything they can to increase the power/attention/capital which flows to them, at the expense of the thing they’re meant to be administering. This was the entire f**king reason that Ethereum got created in the first place!
Nonetheless, over the last 9 years, it seems as individuals we have prioritized other goals instead of upholding this core tenet — we have built systems which we ourselves can control, because we know what Ethereum truly needs better than them. We’ve seen power aggregate to certain individuals (often those most hungry for it), without any proper checks/balances on this behavior. Again, I believe that for a while this was extremely useful (especially in defending against bad-faith attacks from outsiders as the core protocol was still being hardened). But as our protocol has matured, this softening of values has led to our social layer exhibiting a number of tendencies which are antithetical to Ethereum’s core values, and which are hindering the success of Ethereum in the market today.
This post was originally inspired by a series of tweets I made, outlining some of the organizing patterns which I believe are continuing to weaken Ethereum rather than strengthening it.
My claims were that currently:
- In Ethereum culture, the people at the center proclaim what’s true, and the rest of the group is expected to accept it at face value with 0 debate. Even useful criticism will be deemed “problematic” and ignored, in order to defend narratives vs actually searching for truth.
- Ethereum’s culture also heavily favors external signalling, focusing on how people present themselves/what they say vs the outcomes of their actions.
- Ethereum’s culture is based on insular communities and constant purity tests, where anyone who doesn’t pass their tests is deemed part of the out-group and gets shunned.
- Ethereum’s culture claims to empower marginalized voices, but in reality is extremely good at consolidating power among the few gatekeepers who have clawed their way to the top.
While some of these have already been covered both above (and will be covered below via some specific examples), I want to also share a number of broad historical reference points for when these dynamics originally developed and strengthened themselves within the ecosystem over the years.
The DAO Fork (2016)
The famous DAO Hack led to a hard fork split into ETH and ETC. The decision to fork the protocol was framed as “the only viable option” by influential Ethereum leaders, and critics of the hard fork were dismissed as purists for being unwilling to accept the necessary tradeoffs. After the fork, people in favor of ETC were shunned and marginalized, painted as “agitators” despite producing valid critiques of Ethereum’s governance model. The fork was publicly portrayed as a win — evidence of how adaptable and committed to the community Ethereum was, despite the decision serving to consolidate power among a few key individuals.
The Parity Wallet Hack (2017-2019)
In 2017, someone triggered a bug in the multisig smart contract wallets and froze $280M worth of ETH. A proposal (EIP-999) was floated to fork and recover those frozen funds, which led to heated debate within the ecosystem. This time however, those same Ethereum leaders claimed that such a fork would create a slippery slope, and shut down any constructive discussions about reclaiming those funds. Anyone who supported the proposal was criticized for prioritizing their personal interests over those of Ethereum itself. Importantly however, this disagreement coincided with an increasing personal rift between Gavin Wood/ the Parity mafia, and the individuals who wielded the power to help ensure this proposal failed.
The First Ethereum Bear Market (2018-2019)
During our first bear market, the ecosystem struggled with stagnation in our adoption and scalability. The chain had become too crowded/expensive for many non-wealthy people to use, and they eventually moved onto cheaper alternatives like TRON. During this time we also witnessed significant delays in the development of ETH2.0, and a general drying up of new functional applications being built. During this time, anyone who pointed out Ethereum’s shortcomings were dismissed for spreading FUD, and these conversations were framed as attacks on Ethereum rather than healthy opportunities for reflections. This period also led to the formation of stronger Ethereum Maximalists, who felt emboldened to exclusively spread positive news (ostracizing anyone who did the opposite). The result was that our ecosystem became significantly more insular, and much more of an echo-chamber than it was before this period.
The ProgPoW Controversy (2018-2021)
The ProgPoW upgrade was aimed at reducing the efficiency gap between ASICS and GPUs, in order to ensure a more fair distribution of mining power. The proposal was initially supported by people who were employed by the EF/core dev teams, who framed it as a technical improvement. People who criticized the proposal were dismissed as being “anti decentralization” or “anti Ethereum”, creating an ingroup/outgroup dynamic that created tension by framing the conversation about loyalty to Ethereum’s values vs the technical merits of the proposal itself. In the end the proposal was abandoned, but not before creating significant rifts within the ecosystem.
EIP-1559 and Inflation Reduction (2021)
This proposal introduced a fee-burning mechanism to Ethereum, which benefited existing ETH holders by reducing supply and simultaneously cutting miner income. While many participants [ETH maxi’s] celebrated it broadly and created memes to help drive the narrative home (remember the bats?), it was naturally unpopular among miners, who were framed to be villains despite having upheld the network for the previous 5+ years. Even those who weren’t active miners but criticized the proposal were shunned and ostracized for not toeing the line.
The Rollup Debate and L2 Centralization (2021-2023)
Ethereum has now largely shifted heavily towards an L2 centric roadmap, an approach which is now heavily favored by Vitalik and other prominent leaders in our ecosystem. While rollups do solve a number of the scalability issues that the core protocol is facing, they lead to significant security issues due to the centralization risks they open up (an over-reliance on sequencers, multisigs, and opaque governance processes). Many of these solutions are also developed by for-profit entities, who once again have a fiduciary duty to their investors to generate returns on capital invested, and are not exactly designed to produce public goods. Despite these projects proclaiming their alignment with Ethereum’s core values, there is currently no way for the protocol/ecosystem to hold these projects accountable (beyond social shaming and pitting them against each other). Once again, critics of this roadmap choice have struggled to be heard against well-funded projects with larger marketing influence and connections, consolidating power in a few centralized entities.
Even if one believes that at all of these key decision forks our ecosystem took the right course (I generally do), it’s still fairly self-evident how the dynamics I referenced above came to form and strengthen their hold over our community. Over time we got better at narrative control and discouraging dissent, under the guise of maintaining cohesion. We got better at external signaling, allowing centralized power structures to persist despite communicating the opposite. We got better at administering our purity tests, often driving out critical voices by tiring them out / blocking them from spaces where conversations happen / encouraging new dissenters to shut up and follow existing narratives. With each successive step, this culture strengthened — anyone who spoke up, who dissented, who dared to challenge the few core individuals who wielded power, were increasingly ostracized and de-platformed.
With every step the core protocol grew stronger, while the social layer grew weaker.
As an ecosystem, those with power got better at wielding the core levers which are most impactful in an individual’s success, which are most likely to influence them in the direction of maintaining the status quo vs questioning authority.
Those levers are:
- Attention — which individuals/teams/products/protocols get featured in the leading media channels and outlets, including podcasts, conference speaking slots, and Vitalik’s blog posts.
- Funding — which individuals/teams/products/protocols are able to raise from angels and funds in the ecosystem, vs seeking funding from competing ecosystems.
- Social Inclusion — which individuals/teams/products/protocols are invited to host or participate in the various back rooms and group chats where important decisions get made.
Those who do a good job of signalling adherence to the various existing ingroups’ goals are continuously rewarded with increased attention/funding/power. Those who step out of line are punished, and eventually incentivized to simply go build elsewhere.
I believe that this is one of the core reasons why Ethereum has struggled to continue attracting new developers over the last few years, especially as well-funded alt-L1 chains have emerged to compete with Ethereum. If you’re a smart developer trying to build a new blockchain based project, these kinds of dynamics are anathema to you. Why would you want to join an ecosystem that values hypocrisy, where your valid and honest and well-intended feedback only serves to weaken your ability to succeed? Smart founders are truth seekers — they value intellectual honesty above all else, and they generally despise having to play various political games in order to succeed. They want to win on merit, they want the best ideas to float to the top; not just the ones which are properly aligned with the existing power structures which have developed over the last 9 years.
I believe this is why the current calls for “more developers” and “more dapps” by Ethereum’s leaders feels at best extremely self-unaware, and at worst feels like an attempt to gaslight the people who have slowly left our community for others which are more open to honest discourse. Our protocol has succeeded by driving out truth seeking individuals, and then throws up its hands and asks why they left. Have we considered that it’s time to take a hard look at ourselves in the mirror? Are we even still capable of this kind of self-reflection, or has our success simply gone to our heads?
While the historical examples I listed above have likely been useful in highlighting how our social layer became this broken, I still believe that this post would be incomplete if I didn’t stick my neck out a bit and actually call out some of the specific individuals and groups which I have personally witnessed act in a way that is so deeply against our ethos that their behavior can explicitly be described as evidence of the social layer being very broken. Once again I will state that despite the fact that I disagree with the tactics that these people have employed, I still choose to believe they were doing it because they thought it made Ethereum stronger — I won’t ascribe malice where other explanations are just as likely.
The Bankless Bullies
On numerous occasions, I have personally witnessed how Bankless Media (and the individuals who run it) have exercised their accumulated power to achieve their own personal ends. This goes from their desire to enforce what they believe are the important narratives worth defending (like Solana not being a credible L1 or dismissing critics of the rollup centric roadmap), to elevating “aligned” voices while de-platforming individuals who opposed them, to quite literally bullying individuals (especially females) who dared act in a manner that disagreed with them or opposed their personal interests, or those of groups they’re aligned with. Bankless always seems to be on top of the important narratives coming out of the EF, to the degree that it could essentially be considered Ethereum’s de-facto PR arm. And yet, Bankless is presented to the public as an independent media organization, producing “unbiased content”. Over the last 5 years, Bankless has grown to become one of the most important audio/video publishing networks in Ethereum, and perhaps even crypto at large — this is an accomplishment that David and Ryan should feel sincerely proud of. And yet, as an ecosystem, we have to ask ourselves — is Ethereum a healthier organism when its most prominent journalists operate without any sense of journalistic independence? Is it normal for EF-enshrined media outlets to regularly wield their power to accomplish their own personal goals?
Gitcoin’s “Public Goods”
Over the last 5 years, Gitcoin has increasingly been touted as one of the primary venues for funding and sustaining public goods on Ethereum. It’s helped channel over $60M in funding from key organizations like the EF, and for a while was prominently featured and raised up by Vitalik as being a prime example of a values-aligned project on Ethereum — again this is something that Kevin and his team should feel extremely proud of. And yet, when looking past the surface words and graphics, one sees an entirely different picture. I have personally never encountered an organization within Ethereum that is quite as skilled at duplicity as Gitcoin. Whether it’s constantly memejacking from adjacent communities, to actually stealing ideas from potential “collaborators” (who they see as competitors), to eschewing attempts to actually decentralize their power and decision making. Gitcoin has on the one hand been extremely good at saying one thing publicly, and acting another way behind closed doors, all in service of driving more capital/attention/power to themselves. While I had personal experiences in building alongside Kevin early in my Ethereum career which alerted me to these qualities, for a while I wrote them off as likely being one-offs, or just personal blunders of mine. However over the last 5 years this pattern has only continued to perpetuate itself long after I stopped working with him, and has led to a constant exodus of core team members who eventually realize the consequences of working with someone whose actions are not aligned with their words. It’s hard to know exactly how many well-intentioned individuals who wanted to help build the future of public goods have churned from our ecosystem after getting chewed up and realizing how false this facade really is.
Vitalik’s Sporadic Signalling
While I love the fact that Ethereum continues to be led by an active crusader who makes innumerable sacrifices in service of the protocol he created, it’s tough to talk about the failings in our social layer without pointing to the ways that Vitalik has used his power to direct the public’s attention towards specific projects, to the detriment of the broader ecosystem. Besides his aforementioned lifting up of a false public goods ecosystem, Vitalik has consistently tried to drive attention towards use-cases he personally deems values-aligned, ignoring (or outright criticizing) other valuable use-cases which were dominant on the chain — NFTs and Defi being the two obvious examples here. Again it’s impossible to know what the ecosystem would look like if Vitalik had directed some of the attention he receives towards those spaces in a healthy way, or if he had simply chosen to avoid speaking on these kinds of use-cases altogether, in order to maintain healthy impartiality. But from my perspective, I can personally attest that it’s incredibly demoralizing to build something valuable and important in Ethereum’s history, only to have its primary leader turn in the opposite direction and then say that we need more builders. While the Bitcoin ecosystem benefits from a purely market-driven approach (where the top projects bubble up to the top, without the help of centralized actors who accelerate their growth), Ethereum is markedly different, and in my view it has significantly hindered the development of interesting and novel applications built on the chain. The person who founded Ethereum should not have a personal say over what is and is not an important use of public blockspace — again this is the entire point of Ethereum’s existence.
While these are just some personal examples that I feel confident enough about to be willing to wager my reputation on sharing them, I have also heard a plethora of other stories of significant capture within our ecosystem, enabled by the same mechanisms I describe above. I’ve chosen not to publish those in this post (despite receiving some DMs about them), because I believe our ecosystem will be healthier if those individuals can muster the courage to publish their own stories themselves, perhaps as a reply to this post or in other venues.
