Is ENS Drama the New Nail in the Coffin for DAOs?

These are the biggest stories in web3:

• Ethereum Foundation cuts 20% of staff and 40% of budget in sweeping reorg
• ENS DAO delegates call Foundation proposal a governance attack as Johnson self-delegates
• Zuckerberg orders Meta to build a standalone prediction market app, Arena
• Senate passes housing bill with a Fed CBDC ban through 2030 in 85-5 vote

The EF Shrinks, ENS Consolidates

One way to read the latest DeFi news: Ethereum's base layer is still a genuine outlier — one of the few parts of the ecosystem staying decentralized while others consolidate.

The Ethereum Foundation restructuring — a ~40% budget cut, 54 roles gone, work migrating out to independent teams like the new Ethlabs — reads like retreat. But to the EF, this path will make Ethereum stronger. No company runs Ethereum; a spread of independent teams does. The EF shrinking itself is a refusal to become the entity that controls the chain.

It’s not the only team pushing power outward. Just this week, privacy L2 Aztec hit L2Beat's Stage 2 — the tracker's top decentralization tier — after onchain governance revoked ownership of its rollup contract, freezing the code with no admin override.

But across much of the app layer, the pull runs the other way.

On Friday, ENS DAO opened a temp check to move its treasury, including its operational wallet, ENS holdings, and a ~$100M Endowment, to an expanded five-seat Foundation board. Then founder Nick Johnson self-delegated roughly half the DAO's voting supply to push it through. Delegate Lefteris Karapetsas said, here's "no DAO anymore." Security Council member Brantly Millegan calls it "treasury capture" and is readying a veto.

If the proposal passes, ENS will only be the latest Ethereum project to increasingly centralize its operations.

Uniswap's UNIfication folded the Uniswap Foundation's teams into Uniswap Labs, leaving Labs as the single operating company while a lean Foundation winds down its remaining grants. The vote passed with 99.9% support. Aave's "Aave Will Win" routed funding and execution through founder Stani Kulechov's Aave Labs, with a $25M grant attached. Longtime contributors BGD Labs and the Aave Chan Initiative exited over Labs' grip on governance; risk firm Chaos Labs left over budget and the V4 rollout. Kulechov said there is "zero room for friction. Even MakerDAO/Sky Endgame, cuts both ways, splinters the protocol into semi-autonomous "Stars," yet arguably, real influence still concentrates around Rune Christensen.

While there are exceptions, it’s a growing trend that blockchain startups that started out with decentralized organizations and roadmaps, are looking more like traditional web2 companies, with one entity at the center making the calls, whether it be a Foundation or Labs.

To purists, this feels like a betrayal of the original promise of crypto. But maybe the market is just learning where decentralization earns its keep. At the base layer, it's essential: it's what makes Ethereum uncapturable, the thing no company or government can switch off. At the app layer, it increasingly looks like overkill: a tax on shipping, paid in forum debates and stalled votes, when a focused team would simply move faster.

Both can be right.

With love, Cami

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WATCH

$STRC Meltdown: Is Michael Saylor's Strategy Entering a Death Spiral?

The structured-capital playbook this newsletter has tracked since early June got its first real stress test this week. STRC hit a ~$82 low, the ATM is frozen, and Strategy sold BTC for the first time since 2022. Camila Russo sits with Jeff Dorman, CIO of Arca, and Austin Campbell, founder of Zero Knowledge, for the death-spiral debate now running across crypto desks.

Dorman argues Saylor may have to dump billions in BTC to save the preferred stack; Campbell questions whether the structure was ever sound. The live conversation airs the question Thursday's Article 3 surfaced — when STRC trades 15% below par, does the BTC-treasury funding channel survive, or does the issuer become a forced seller? Worth watching for whether the two sides converge on a specific tripwire.

DEFI

ENS DAO Delegates Call Foundation Proposal a Governance Attack as Johnson Self-Delegates

ENS DAO delegates publicly rejected the ENS Foundation's authority-handover proposal Tuesday, branding the plan a governance attack after lead developer Nick Johnson self-delegated a meaningful share of voting weight in the same window. The proposal — introduced as a temp check yesterday — would consolidate budgeting, vendor management, and routine execution under the foundation. Top delegates argue the operational handover, paired with the self-delegation, would give the foundation effective control over the parameters the DAO still nominally owns.

Why this matters: ENS is the first major Ethereum-native DAO with both a real treasury and an active foundation to test the authority handover live and in opposition. The outcome — whether the DAO blocks the proposal, accepts a redrafted version, or concedes — will set the template for every protocol DAO that currently has the same arrangement on the calendar.

BLOCKCHAINS

Ethereum Foundation Cuts 20% of Staff in Sweeping Reorganization

The Ethereum Foundation eliminated 54 positions — about 20% of its workforce — as part of a sweeping reorganization tied to a 40% annual budget cut announced by Vitalik Buterin Tuesday. The cuts touch client development, Devcon, and institutional-relations work; Buterin warned of "grand sacrifices" and framed the restructuring as the EF Way execution plan moving from agenda to operations. The plan landed Monday alongside the parallel Ethlabs spinout.

Why this matters: EF cutting 40% of budget and 20% of staff in one move is the real signal — the interim ED's plan was the language, this is the implementation. Whether the leaner org ships against the narrower agenda is now the only metric that matters for Ethereum's coordination layer over the next two quarters.

DEFI

Zuckerberg Orders Meta to Build Standalone Prediction Market App, Codenamed Arena

Mark Zuckerberg ordered Meta to build a standalone prediction market app, codenamed Arena, per reporting Tuesday. Arena would be a native iOS and Android product inside the Meta family, distinct from any in-app feature on Facebook or Instagram. The directive lands one day after the WSJ reported $1.9M in fake bets propping up Polymarket creator videos — the kind of incentive-gaming risk a Meta-scale prediction market would inherit at launch.

Why this matters: Polymarket built distribution by being the only credible venue. Meta entering changes the calculus: a tech giant with three billion users and a track record of monetizing engagement now wants the same surface area. Watch whether Arena ships in the US under the prediction-market rulebook Polymarket has been litigating or under a different regulatory framing.

REGULATION

Senate Passes Housing Bill With Fed CBDC Ban Through 2030 in 85-5 Vote

The US Senate passed a housing bill carrying a Federal Reserve CBDC ban through 2030 in an 85-5 vote, a bipartisan supermajority blocking the Fed from issuing a retail central-bank digital currency for the next four years. The amendment passed without the procedural fight that has shadowed every prior CBDC vote, and now heads to House reconciliation.

Why this matters: The 85-5 margin is a clear political settlement: the Senate is not going to authorize a retail Fed CBDC this decade. That leaves the US stablecoin stack as the only viable channel for digital-dollar adoption, accelerating the GENIUS Act / market-structure trajectory and creating policy space for the bank-issued stablecoin product running through SoFi and others in today's Other Stories.

Other Stories Worth Your Time

Treasury Sanctions Three Individuals and Six Entities for Routing Crypto to ISIS — the US Treasury Department sanctioned three individuals and six entities for routing crypto payments to ISIS, the largest single sanctions action against a crypto-laundering network this year.

MoneyGram Becomes Solana Validator, Joins Institutional Developer Platform — MoneyGram became a Solana validator and joined the Solana Institutional Developer Platform, an unusual step for a TradFi remittance giant to operate consensus infrastructure directly instead of routing through partners.

SoFi's Bank-Issued Stablecoin Hits $150M as Bullish Becomes First CEX to List It — SoFi's bank-issued stablecoin SoFiUSD crossed $150 million in circulating supply, with Bullish becoming the first centralized exchange to list it.

Bithumb Lists Canton (CC) in Korean Won Market as Institutional Blockchain Eyes Retail Liquidity — Bithumb opened a Korean-Won market for the Canton Coin (CC), the first major Korean retail listing of an institutional blockchain native asset.

SBI Group Plans to Issue Yen Stablecoin JPYSC as Early as This Week, Nikkei Reports — SBI Group plans to issue a yen stablecoin called JPYSC as early as this week per Nikkei reporting, under Japan's Payment Services Act framework — Japan's first major bank-backed stablecoin issuance.

Ripple Wins Preliminary MiCA CASP Approval in Luxembourg, Unlocking EEA Passporting — Ripple won preliminary MiCA CASP approval in Luxembourg, unlocking EEA-wide passporting once the final license issues; positions Ripple ahead of most US-based competitors on EU market access.

House Sets July CLARITY Act Field Hearing as Lummis Presses for a Senate Floor Vote Before the Recess — the House Financial Services Committee scheduled a July field hearing on the CLARITY Act as Senator Cynthia Lummis pressed for a Senate floor vote before the August recess.

Securitize Wraps Roubini's SEC-Registered ETF as Dubai VARA Digital Security — Securitize wrapped Nouriel Roubini's SEC-registered USAFI ETF as a Dubai VARA digital security, one of the first cross-jurisdictional bridges between US-listed and UAE-tokenized fund products.

Aztec Tells V4 Users to Withdraw Before June 25 as V5 Upgrade Exposes Security Flaws — Aztec told V4 users to withdraw before June 25 because the V5 upgrade exposes a security vulnerability in the legacy V4 contracts — an urgent migration with a hard deadline.

Warwick Takes Personal Blame for sUSD Mismanagement, Charts Basis-Vault Replacement — Synthetix founder Kain Warwick took personal blame for the sUSD depeg, charting a basis-vault replacement architecture as the cleanup path.

Quantstamp Breaks Down How a Counterfeiting Bug Hid in Zcash's Orchard Pool for Four Years — Quantstamp published a technical breakdown of the counterfeiting bug that hid in Zcash's Orchard shielded pool for years, with a coordinated disclosure now closing the issue.

Trending on The Defiant

• a16z-Backed Goldfinch Finance Winds Down After Originating $100M in Loans
• Five Former EF Researchers Launch Ethlabs, an Independent Non-Profit R&D Lab for Ethereum
• Chainlink Brings Samsung, Toyota and Sony Pricing On-Chain With APAC Equities Streams
• Aztec Reaches L2Beat Stage 2 After Governance Revokes Rollup Contract Ownership
• WSJ: $1.9M in Fake Bets Propped Up Polymarket Creator Videos