Ethereum Researcher Earns Millions in Advisory Fees for Working on EigenLayer, Ethereum Foundation Faces Trust Crisis

Original Title: "Earning More by Working More: Ethereum Researchers Are 'Restaking' Themselves"

Original Author: Alex Liu, Foresight News

 

"With over 300 people in the Ethereum Foundation, having a few of them serve as advisors to the Eigen Foundation won't affect its neutrality." This sounds reasonable, unless those "few" include Dankrad Feist and Justin Drake.

 

Recently, several researchers from the Ethereum Foundation have publicly disclosed that they have accepted advisory positions with the Eigen Foundation, the entity behind the restaking protocol EigenLayer, and will receive significant EIGEN tokens as compensation. This has sparked considerable controversy and heated discussions within the community. The author believes that understanding the ins and outs of this incident can help everyone grasp the dilemmas faced by Ethereum developers and the community at the level of "social consensus."

 

Background: The Ethereum Community Starts Arguing

 

With influential developers and opinion leaders like Vitalik becoming active on Farcaster, the Ethereum community, unlike Solana's Mert who continuously engages and brings attention to the community, has been relatively "quiet" for a considerable time. But now, the calm has finally been broken—Péter Szilágyi, the lead developer of Ethereum's main execution client Geth, and Dankrad Feist, a core member of the Ethereum Foundation, have started arguing.

 

The argument mainly revolves around MEV and development progress, with Péter expressing dissatisfaction with the current state of Ethereum's development. Regarding MEV, Peter believes it is essentially an attack on Ethereum, but by sharing the profits with stakeholders, the problem ceases to be a problem.

 

This reflects a challenge beyond development: as the protocol grows larger and more decentralized, the number of participants, or stakeholders, increases. How should their interests be coordinated and balanced?

 

Eventually, Vitalik joined the discussion on X.

 

Main Issue: Potential Conflicts of Interest Spark Controversy

 

Vitalik subsequently praised the Ethereum community's "open discussion." But in a thread on this topic, legendary crypto influencer Cobie responded to him, asking, "What do you think about core developers or researchers of the Ethereum Foundation receiving life-changing amounts of compensation and becoming advisors for projects built on Ethereum? These projects might have conflicts of interest with Ethereum now or in the future, for example—purely theoretically—EigenLayer."

 

 

Cobie clearly knew some inside information and did not mention EigenLayer randomly. Shortly after his post, Justin Drake, a core researcher at the Ethereum Foundation, disclosed in a long post on X that he would become an advisor to the Eigen Foundation and receive millions of dollars in token incentives, "worth more than all his other personal assets combined."

 

 

Why has this caused such a huge controversy? Can't a person hold positions in multiple organizations simultaneously? The answer is: yes, they can. But what if the entities they work for might have conflicts of interest? Things get complicated.

 

Restaking, usually considered to introduce additional risks to Ethereum at the protocol level, simply put, may not necessarily benefit Ethereum and could even lead to potential conflicts of interest—for example, additional slashing when providing security guarantees to third parties, which in the worst-case scenario could lead to users who lost assets attempting to fork Ethereum.

 

Regarding restaking, a common explanation is making one asset work multiple jobs to earn multiple incomes. In this light, these Ethereum researchers seem to be "restaking" themselves, trying to work multiple jobs. Restaking is risky, and working multiple jobs might backfire (if the company is unreliable, the principal could be slashed).

 

Although these researchers claim that their advisory roles are personal and do not represent the Ethereum Foundation, and they can fully hold dissenting views on EigenLayer and be ready to end their advisory positions if EigenLayer takes actions against Ethereum's interests, community members have raised a soul-searching question:

 

"Do you really think receiving huge compensation from an organization with different incentives from Ethereum won't affect your decisions?" Will researchers holding advisory roles in interested projects affect the Ethereum Foundation's neutral stance?

 

As mentioned at the beginning of the article: "With over 300 people in the Ethereum Foundation, having a few of them serve as advisors to the Eigen Foundation won't affect its neutrality." This sounds reasonable, unless those "few" include Dankrad Feist and Justin Drake. Because Dankrad Feist and Justin Drake are influential figures who can significantly impact Ethereum—Justin Drake is crucial in the layout of Ethereum 2.0, and this year's biggest narrative for Ethereum, aside from the ETF, is the Cancun upgrade, which implements proto-danksharding, laying the foundation for true danksharding. Yes, the expansion solution ultimately chosen by the Ethereum mainnet was proposed by Dankrad Feist and named after him.

 

Such individuals will receive millions of dollars in EIGEN tokens, paid to critique EigenLayer. Whether the Eigen Foundation is doing charity for public welfare, please judge for yourself.

 

Later, Péter Szilágyi and Dankrad Feist had another argument, with Péter asking, "So who decides what is necessary for the protocol and what is not?" Dankrad replied, "Obviously, I do."

 

Then Péter Szilágyi sarcastically said, "I thought it was EigenLayer, my bad."

 

Dankrad did not respond further.

 

 

Analysis: EigenLayer Uses Tokens to Recruit Allies

 

We have no evidence to prove the purpose of EigenLayer offering so many tokens to recruit "advisors," but we can observe an interesting fact.

 

Ten months ago, Bankless did a podcast titled "Restaking Alignment." Among the seven participants, most had relatively negative attitudes towards restaking (including Justin Drake and Dankrad).

 

Now, six of the people in the picture below hold stakes in EigenLayer (through angel investments, advisory positions, or employment), and the seventh person in the podcast is Vitalik.

 

 

In this regard, Sreeram might be the most outstanding ever.

 

Reflection: Better and More Transparent Information Disclosure

 

The Ethereum Foundation is essentially a non-profit organization. In the crypto industry, such foundations are less transparent compared to traditional companies or foundations, lacking basic information disclosure. This incident has exposed this issue, and community members have raised related concerns, pointing out:

 

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