What happened?
Former Geth lead Péter Szilágyi published a blunt letter saying Ethereum is effectively run by a small cabal of five to ten influential people despite public claims of decentralization. He accused Vitalik Buterin of holding “complete indirect control” through attention, donations, investments and influence over researchers, and warned the Foundation’s low pay created incentives for protocol capture. Szilágyi described a “useful fool” dynamic where challenging power hurts reputations while silence lets the same players steer the protocol.
Who does this affect?
Core developers and long‑time contributors who were underpaid and may lose influence or leave the ecosystem are directly affected. New projects and startups now often need the approval or backing of that small circle to gain visibility, funding, or technical help. Everyday users, ETH holders and wider crypto investors are also impacted because their trust in Ethereum’s governance and openness is at stake.
Why does this matter?
Concentration of influence undermines trust in Ethereum’s decentralization and could slow developer and user adoption if people see decisions as centrally controlled. Talent, projects and capital might flow to rival chains or VC‑backed L1s, shifting innovation and liquidity away from Ethereum. That shift can increase market volatility, put downward pressure on ETH, and draw more regulatory and investor scrutiny across the crypto market.