The Ethereum Foundation (EF) is considering implementing a formal conflict of interest policy following backlash over the appointment of two prominent developers to the EigenLayer advisory board.
Executive Director Aya Miyaguchi addressed the issue in a social media post, emphasizing the importance of maintaining a credible neutrality within the organization. She said the foundation shares the community's concerns and is committed to maintaining that trust.
Miyaguchi said:
“It is clear that relying on culture and individual judgment is not enough, and we have been working for some time on developing formal policies to address this issue. We are accelerating this work and will share an update soon.”
Controversy
The controversy began on May 18, when prominent crypto trader Jordan Fish, better known as Coby, publicly questioned Ethereum co-founder Vitalik Buterin about the ethics of EF developers receiving large financial incentives from projects built on the network.
Cobie's tweet specifically named EigenLayer as an example and sparked widespread discussion on social media about potential conflicts of interest.
“How would you feel about core developers and researchers at the Ethereum Foundation becoming 'advisors' and taking life-changing packages from projects built on Ethereum that may have conflicting incentives with Ethereum now or in the future. Take EigenLayer for example, purely theoretical of course.”
Following Coby's tweet, Justin Drake, a researcher at the Ethereum Foundation, revealed his advisory role at Eigenlayer on May 19. Drake revealed that he received a large incentive in the form of Eigentokens estimated to be worth millions of dollars over a three-year vesting period.
The disclosure raised concerns about transparency and potential conflicts of interest between EigenLayer and the Ethereum Foundation. Drake also said that the information has been public since May 3 and that the timing of Coby's tweet and disclosure was coincidental.
On May 21, another Ethereum Foundation researcher, Danklad Feist, also revealed his advisory role on Eigenlayer. Known for his work on “Dunksharding,” Feist confirmed that he too had received a significant allocation of EIGEN tokens and assured the community that his advisory role will not affect his position in Eigenlayer’s development.
Conflict of interest concerns
The disclosure raises questions about potential conflicts of interest, especially given the systemic risks that EigenLayer could pose to Ethereum. EigenLayer is a platform that allows users to deposit and “restake” Ether from various liquidity staking tokens to secure third-party networks and verified services.
Many blockchain experts have expressed concerns about the potential centralization of running a re-staking service and the additional burden it places on stakers.
Drake assured the community that he would reinvest or donate all profits to worthy projects within the Ethereum ecosystem, and promised to terminate his advisory role if EigenLayer's instructions conflict with Ethereum's interests.
In his disclosure, Feist emphasized that he takes a contrarian view on EigenLayer to focus on risk and diversification. He wrote:
“I serve in this role personally, not on behalf of the Ethereum Foundation, and my focus is on risk and decentralization. I receive a significant amount of tokens from this role. I do not expect this to change or affect my position on how the core protocol is developed, but I do think the community will be able to hold me accountable by knowing this.”
The Ethereum Foundation's move to formalize its conflict of interest policy is an important step toward addressing community concerns and maintaining trust within the ecosystem. The Foundation plans to provide further updates on this policy in the coming days.
