Where is Ethereum on its long journey?

Author: Kathy Source: X, @Kathydotxyz

In October 1934, the Central Red Army set off from Jiangxi. No one called that departure the "Long March." It was just a hasty retreat—the fifth counter-encirclement campaign had failed, the base area could not be held, and more than 80,000 people, carrying guns, headed west, not knowing where their destination was.

It was just a hasty retreat—the fifth counter-encirclement campaign had failed, the base area could not be held, and more than 80,000 people, carrying guns, headed west, not knowing where their destination was.

Yesterday, I was reading the news about @VitalikButerin on ETH CC, and it suddenly reminded me of the Long March.

It's not that Ethereum is "miserable," but the feeling of that situation is very similar.

What was once the most impregnable stronghold suddenly found itself riddled with vulnerabilities; what was once an unquestionable narrative suddenly found itself disbelieved even by its own people. So the question arises: Has the Ethereum Foundation emerged from its predicament? The Fifth Counter-Encirclement Failed. Only by clearly explaining the defeat can we understand everything that followed. The past two years have been two years of "multi-faceted collapse" for Ethereum. The ETH/BTC ratio fell back to 2021 levels, and the price of ETH has been very volatile, barely breaking through the previous high in 2025 before falling again. The on-chain data is also quite poor. Solana's DEX trading volume has surpassed Ethereum across the board, with a record-breaking $650 billion in stablecoin trading volume in February 2026. Monthly active users reach 98 million, a number you can hardly ignore. But these are still external threats. The Ethereum Foundation has dug itself a deeper hole—the "L2 parasitic effect." In March 2024, Dencun was upgraded and launched, causing L2 transaction fees to drop by 99% overnight. This was originally good news: cheaper, scalable, and a better user experience. But then one thing became clear: the more prosperous L2 becomes, the more hollow L1 becomes. Coinbase's Base chain generated $75 million in revenue in 2025. Ethereum's L1 protocol revenue during the same period was $39.2 million. Ethereum's L1 revenue was less than half that of an L2 blockchain built upon it. The Blob fees paid by L2 to L1 were extremely low, and the burning mechanism of EIP-1559 was almost ineffective. As a result, in the third quarter of 2025, Ethereum's annualized supply growth rate rebounded to +0.22%—the deflationary narrative of "Ultra Sound Money" officially collapsed. Meanwhile, the EF treasury was also running low. The treasury figures released in October 2024 showed $970.2 million, a 39% decrease from the previous disclosure. Over the past six months, EF has sold a total of 16,000 ETH to bleed itself dry. In short: Facing strong external enemies and internal parasites, with a shrinking treasury, its narrative has collapsed. Doesn't this resemble the failed fifth counter-encirclement campaign? The Zunyi Conference: A Change of Leadership is Necessary. Having failed to this extent, the leadership must change. In January 2025, EF Executive Director Aya Miyaguchi (@AyaMiyagotchi) announced her resignation. Vitalik personally announced: "I am the one who decides on the new EF leadership team." This statement is intriguing—it's both a takeover and an admission of guilt: EF's past independent governance was merely a formality. The newly appointed co-executive directors were Wang Xiaowei (@hwwonx) and Tomasz Stańczak (@tkstanczak). The direction seemed clear. But just 11 months later, Stańczak resigned. Three changes in core executives within 13 months. This wasn't the most shocking part. In October 2025, a resignation letter written in May 2024 was made public. The author was Péter Szilágyi (@peter_szilagyi)—the former head of the Geth client, the creator of the client that once supported more than 60% of Ethereum nodes. He had worked at EF for a full nine years. The contents of the letter shocked the entire community. Szilágyi stated that his total income over six years was $625,000—pre-tax, averaging approximately $100,000 per year. During the same period, the blockchain he helped build saw its market capitalization rise from zero to $450 billion. Meanwhile, EF secretly funded a "second Geth team" within Nethermind without his knowledge—essentially creating a separate entity behind his back. When he discovered this and voiced his opposition, he was fired within 24 hours. He also pointed out that EF possessed a small "ruling elite" circle of 5 to 10 people, centered around Vitalik, supported by 1 to 3 VCs, appearing decentralized but actually highly centralized. He described himself as a "useful fool." This echoes the Long March. The Zunyi Conference didn't eliminate internal conflicts; rather, in the most dire moment, it ensured that one person's judgment became an unshakeable compass. The EF leadership overhaul in early 2025 also carries this implication—Vitalik wasn't "listening to opinions," he was consolidating power and reorganizing, using the crisis as an opportunity to re-establish control over the roadmap. The Long March was able to continue because someone was willing to bear the final responsibility for judgment. Strategic Shift: A Major Turnaround in the Roadmap With a change in leadership, the roadmap also had to change. The old logic was: L1 ensures security, and scaling relies entirely on L2. The problem with this approach has been discussed above—the more successful L2 is, the more hollow L1 becomes, leading to a break in value capture. In May 2025, Vitalik published an article proposing the "Lean Ethereum" vision: in five years, Ethereum will be as simple as Bitcoin. A more radical proposal: replace the EVM execution architecture with RISC-V, potentially improving performance by 100 times. The slogan sounds good, but the actions speak louder than words. The Fusaka upgrade is the first substantial anchor point. Its core is PeerDAS, which increases Blob data capacity by 2 to 4 times, theoretically reaching 100,000 TPS. But more importantly, it includes EIP-7918: setting a floor price for Blobs, linking it to L1 Gas, and directly reducing Blob costs from 1 wei to 0.01 to 0.5 Gwei. EIP-7918 is the key move in this shift. It's saying: L2 can no longer freeload on L1 security. If you use my data layer, you have to pay a reasonable fee. The era of "L2 prosperity, L1 poverty" will be forcibly ended. This is equivalent to the Red Army changing its marching route from a frontal assault to a flanking maneuver during the Long March—not abandoning the battle, but changing its tactics. EthCC 2026: Has Ethereum arrived in "Yan'an"? ETH CC was held in Cannes last week. This conference released several signals, each worthy of examination within the Long March analogy. Disappearance Test: Vitalik mentioned—if he disappeared tomorrow, would Ethereum still function? This is precisely the ultimate goal of the Long March—the system must survive after the leader disappears. By publicly asking this question, he is saying: I know I have a centralization risk, and we need to seriously address this. This is maturity, but also pressure.

EEZ Framework: The day before the EthCC opening, Gnosis, Zisk, and EF jointly announced the Ethereum Economic Zone (EEZ). The goal is to allow contracts on different rollups to call each other within the same transaction through real-time zero-knowledge proofs—solving the "hundred islands problem" of $40 billion in assets being locked on over twenty isolated chains. Yan'an was a base area because it had logistics and infrastructure. EEZ does exactly that. But it's important to clarify: EEZ is not yet online.

The Agora Institutional Forum: Representatives from JP Morgan and Societe Generale-Forge sat on stage discussing on-chain finance. Traditional financial institutions actively negotiating; it's not that Ethereum has compromised, it's that Ethereum has grown. Of course, MiCA regulatory pressure and Solana's continued pursuit are real variables, and we can't only look at the positive side.

Core Judgment: Has it overcome its difficulties?

Let's make a comparison first: Judging from a series of signals released by ETH CC, the strategic shift has been completed, but it hasn't yet reached its destination. "The strategic shift has been completed" means that the direction has truly changed. Vitalik personally spearheaded the change in leadership, EIP-7918 directly addresses the L2 parasitic problem, and RISC-V replacing EVM opens up possibilities for a 10-year technology roadmap. This isn't patching; it's a complete reshaping of the roadmap. "Having not yet reached its destination" means that the changes are real, but the results haven't yet materialized. Can EIP-7918 truly improve L1 fee capture? Can ETH/BTC stabilize and rebound? Can developer retention rates stop declining? There are currently no definitive answers to these three indicators. A fundamental question remains: Where is Ethereum's Yan'an? Different people offer different answers. "World computer," "global settlement layer," "programmable money," "censorship-resistant infrastructure"—these visions are not contradictory, but they haven't formed a clear consensus narrative. Without consensus, it's difficult to mobilize the entire ecosystem to follow. The Lessons of the Long March: The significance of the Long March was never about the inherent value of the suffering itself. Suffering is not an asset; suffering is a filter. Its role is to forcibly eliminate wrong routes, wrong commands, and wrong tactics—leaving behind those who survived with sound judgment. Ethereum's besiege over the past two years—the rapid rise of Solana, the L2 parasitic effect, and the internal governance crisis of EF—is real, and so are the reactions. EIP-7918 is a surgical intervention to address economic vulnerabilities. Vitalik's question about the "disappearance test" in Cannes is forcing himself and the entire ecosystem to confront their most vulnerable point. Something nearing its end won't undergo such a specific operation. But the Long March tells us that completing a strategic shift only means arriving at a place where we can start anew. Yan'an is the starting point of the base, not the end. What follows is construction, operation, and consolidating scattered forces into a single direction. Ethereum's success depends on two things: the execution of its technology roadmap and the community's acceptance of the new narrative. The former has a verifiable roadmap, the latter offers no guarantees. So, what is Ethereum's "Yan'an"?