TL;DR:
- The Ethereum Foundation is prioritizing Kohaku, a privacy-focused initiative promoted by Vitalik Buterin on May 26, rather than acting like $ETH price support.
- Kohaku has been in development for almost a year and includes privacy tools, Railgun libraries, privacy pools, and post-quantum account work.
- Internal pressure remains high following the departure of major contributors, while Aave’s revenue-driven strategy highlights a competing growth-focused path for DeFi during the current overall weak market cycle.
The Ethereum Foundation is attempting to address one of the most vocal criticisms of Ethereum without promising what many holders seem to want most: price support. After weeks of community frustration, contributor departures and weakness $ETH performance, Vitalik Buterin promoted Kohaku on May 26, a privacy-focused initiative hosted within the foundation. The foundation’s response is security and privacy, not market defensea position that seems almost deliberately old-fashioned while $ETH is trading around $2,136, less than half of last August’s level and significantly weaker relative to Bitcoin over a five-year window. This tension now defines the foundation’s narrative at a difficult time for frustrated people. $ETH holders across the ecosystem.
I want to make the work we do at the Kohaku Initiative within the FE a little more public.
I notice there is hype, but there is also confusion. The best way to clarify things is to speak frankly and openly about what I work on every day.
🧵time (because I don’t pay Twitter$)
РMs. kzg.eth n̩e Kassandra (@kassandraETH) May 25, 2026
Work on privacy becomes Ethereum’s strategic response
Kohaku has been in development for almost a year and aims to make security, trustlessness, and privacy normal at Ethereum’s access layer. The project repository describes privacy-focused tools that include libraries for Railgun, privacy pools, a vendor abstraction layer, and a post-quantum 4337 account implementation, with several components still marked as work in progress. The initiative is technical infrastructure rather than a sentiment campaignwhich explains both its strategic relevance and the frustration of investors looking for faster and more visible support as the token struggles to regain momentum.
Political pressure within the ecosystem is hard to ignore. At least eight senior contributors have left or announced their departure in 2026, including five in May. Carl Beek, involved in the launch of Beacon Chain, and cryptoeconomics researcher Julian Ma announced their departure on May 18. Buterin responded on May 25 by describing the foundation as a node with a defined purpose, not the central authority of Ethereum. This framework restricts the mandate of the foundationespecially since it plans to reduce token sales and focus on censorship resistance, capture resistance, openness, privacy and security as its main work.
The contrast with Aave shows why the debate seems so unresolved. On May 23, founder Stani Kulechov committed Aave to a 12-month revenue-focused protocol strategy, arguing through action that DeFi must become more sustainable than token speculation. Aave has generated $7.96 million in fees over seven days, holds over $14 billion in total value locked, and has seen V4 cross $100 million in combined deposits and loans. Ethereum now faces two competing instinctsone prioritizing research principles, the other prioritizing revenue, institutions, and measurable growth as the market never stops asking what leadership should deliver next.
