Ethereum Foundation doubles down on DeFi as ETH faces bearish pressure

The Ethereum Foundation (EF) has accelerated its push into decentralized finance by allocating significant funds to support its DeFipunk initiative, even as Ethereum’s price is in a downward trend amid bearish market signals.

Following their push into DeFi, even as ETH faces a downward trend, several reporters reached out to the Swiss-based organization for comments on the matter. Responding to this request, the team alleged that its move to establish a DeFi unit seeks to facilitate the development of new protocols within its App Relations team.

Concerning this statement, sources familiar with the situation, speaking on condition of anonymity, disclosed that in this new project, Charles St. Louis, formerly the CEO of DELV and a key governance architect for MakerDAO, will serve as a DeFi Protocol Specialist. Apart from this information, Ivan (@ivangbi_), a core team member at Gearbox Protocol, a DeFi lending platform, has assumed the role of DeFi Coordinator. At the same time, Jason Chaskin heads the App Relations & Research at the Ethereum Foundation, a part of the broader Ecosystem Acceleration unit.

The Ethereum Foundation sparks hope in the Ethereum ecosystem

Ethereum has struggled to bounce back after falling below its value area high, forming a series of lower highs. Regarding this trend, several analysts argued that it signals a fading bullish momentum and an increasing seller dominance across various timeframes.

To support this claim, they noted that recent price action confirms the bearish outlook. Moreover, the analysts stressed that Ethereum has broken below the point of control (POC), failing to hold the key level that previously defined fair value within its trading range.

Following this decline, the price has dipped into the value area low, testing a major high-timeframe support zone near $1,820. With weakening momentum and underlying structural issues, market participants are scrutinizing Ethereum’s ability to maintain this support, anticipating a potential move to a new yearly low.

Despite this challenges in the Ethereum ecosystem, the Ethereum Foundation claimed that, “We want to see DeFi grow, but we have strong opinions about its direction: it should be permissionless, censorship-resistant, prioritize privacy, be self-custodial, and open source,” further mentioning that, “We understand the challenges in reaching this goal—our job is to advocate for these principles, support teams striving for them, highlight those who are succeeding, and explain how to achieve these aims and why they matter.” 

After the team’s remarks, sources pointed to several key breakthroughs outlined in the blog, including fast on-chain futures as hedging tools, user-controlled AI, and new crypto-native tools such as futarchy DAOs and private undercollateralized loans using ZK proofs.

Furthermore, the blog hinted at the team’s intentions to back existing DeFi initiatives and next-generation decentralized finance solutions. Notably, beyond supporting protocol security and application design research, the DeFi team will establish dedicated channels for direct communication with the EF, as well as public forums for sharing app updates, news, and event promotion.

Additionally, they will work with the EF’s redesigned Privacy Cluster, whose framework was reconstructed in 2025. This initiative aligns with the EF’s ongoing goal of optimising resource allocation and fostering Ethereum’s potential, following a massive realignment last year.

Several investors raise concerns about the current situation in the crypto market 

In an X post, St. Louis stated that, “The Ethereum Foundation supports Defipunk: not finance that’s just slightly better than traditional finance (TradFi), but finance that wouldn’t exist without Ethereum.” According to him, DeFipunk asserts that true DeFi must be built on cypherpunk values, such as self-custody, privacy, and censorship resistance.

While EF moves forward with their DeFipunk initiative, reports highlighted that just as Ethereum, Bitcoin is also sliding. Such a situation created stress among cryptocurrency investors. Surprisingly, most assets remained under spot ETF control, yet BTC lagged at key price levels. 

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