Vitalik Buterin Calls for Ethereum Governance Reset with Market Layer

TLDR

• Vitalik Buterin has proposed a two-layer governance model for Ethereum to enhance accountability and decentralization.
• The first layer would be a market-based system where financial incentives drive decision-making.
• The second layer would focus on decentralized and anonymous voting to foster intrinsic motivation and reduce collusion risks.
• Buterin believes the new governance structure would maximize accountability and fairness within Ethereum’s ecosystem.
• The two-layer system aligns with Ethereum’s roadmap, including scalability and privacy-focused upgrades.

Ethereum co-founder Vitalik Buterin recently emphasized the need for a major overhaul of Ethereum governance. In a new post on X, he proposed a two-layer model aimed at enhancing accountability and decentralization. Buterin advocates for a split between execution and preference-setting layers, suggesting that current governance methods are insufficient for long-term sustainability.

A Two-Layer Governance System for Ethereum

Buterin’s new approach to Ethereum governance focuses on creating two distinct layers. The first layer would serve as a market-based system, where decisions are driven by financial incentives. “The correct way to do a ‘decentralized executive’ in a permissionless system,” Buterin said, explaining that those who make good decisions would profit, while poor decisions lead to losses. This model, he asserts, would maximize accountability within the Ethereum ecosystem.

On top of this execution layer, Buterin calls for a second, non-financial layer that operates anonymously and fosters intrinsic motivation. He stressed that this layer must decentralize and remain pluralistic, with anonymous votes designed to minimize collusion risks. He noted that token-based systems would undermine pluralism, as token owners could buy enough tokens to gain control. By adopting this structure, Buterin aims to create a more effective and fair Ethereum governance model.

Ethereum Governance Needs a Reset

In the context of Ethereum’s evolving roadmap, Buterin’s comments stand out as a clear call for reform. Ethereum has long been seen as a platform for innovation, but its governance has been criticized for lacking proper accountability and transparency. Buterin’s vision for a two-layer governance system seeks to address these concerns head-on by creating a more structured and resistant framework.

Buterin’s ideas already resonate with some members of the Ethereum community. A pseudonymous on-chain analyst, Turtle, highlighted the similarities between Buterin’s vision and the ongoing development of $REPPO, a governance system that combines prediction markets and preference monetization. This system, live since November 2025, exemplifies the type of governance model Buterin envisions.

Ethereum’s roadmap, focused on scalability, rollups, and privacy enhancements, makes such reforms feasible. Upgrades like data availability and sharding-style architectures aim to reduce costs for complex on-chain applications. This technological foundation could make Buterin’s ideal governance structure a reality, providing the necessary tools for transparent, accountable, and capture-resistant systems.

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