According to a new Protocol Guild report shared with Defiant, Ethereum’s core developers earn far less than they do elsewhere.
A survey of over 100 contributors found that Ethereum’s core developers earn 50-60% less than the market offers. According to Defilama, Ethereum is currently the world’s largest blockchain with total value (TVL) locked in decentralized finance (DEFI).
Protocol Guild is a decentralized group that funds Ethereum Ecosystem Developmental, backed by prominent Ethereum-based projects such as Eigenlayer and Etherfi.
The median salary for Ethereum developments surveyed was around $140,000 compared to salaries above $300,000 (plus token or equity) for comparable roles in other projects. Additionally, the median Ethereum contributors receive no rise at all, as typical token or equity grants are reported as $0.
This gap has caused pressure as nearly 40% of protocol developers say they have received external job offers over the past year. Mostly from rival blockchains or Layer 2 (L2) networks. Protocol Guild estimates the average external offer is around $359,000, more than double what most Ethereum contributors have acquired now.
Increased risks to network development
In its report, Protocol Guild warned that wage disparities pose an increased threat to the network. “Inadequate compensation is the risks of talent retention, advances in Ethereum’s technical roadmap, and long-term reliable neutrality,” the report states.
The group also calls on the wider Ethereum community to address the gap, noting that network progress relies on continuing to equitably compensate and incorporate developers.
One effort we are already working hard on is the “1% pledge.” Here, ecosystem projects such as Eigenlayer, Etherfi, Taiko, and Puffer will donate a portion of their token supply to the Protocol Guild. In 2023, global investment manager Vaneck announced that it would donate 10% of the profit generated by the Spot Ether ETF to the Protocol Guild.
This fund will be used to increase payments, reduce sales and keep Ethereum upgrades on track. Since launching in 2022, Protocol Guild has distributed over $32 million to Ethereum core developers through donations and pledges, with a typical member receiving $66,000 over the past 12 months.
That extra funds account for almost a third of the total rewards for many contributors, claiming that 59% of their members are “very or very important” to their ability to continue working with Ethereum.
The report concluded by highlighting Ethereum’s high interests as the network’s ambition is to secure $1 trillion worth, already serving millions of users and supporting thousands of decentralized applications, including key negative protocols such as Lido ($38 billion TVL) and Aave ($4.1 billion TVL).
Ethereum’s native token ether (ETH) is currently trading at $4,350, an 88% increase over the past year, according to Defiant’s pricing page.
