Vitalik Buterin puts privacy and security first at EF while Aave’s Kulechov focuses on revenue

Vitalik Buterin wants the Ethereum Foundation focused on privacy and security. Aave’s Stani Kulechov wants revenue. That is not a small stylistic gap. It is the whole argument right now, because crypto markets have very little patience for long-horizon virtue when the chart looks bad. On May 26, Buterin promoted Kohaku, Ethereum’s access-layer privacy project. Three days earlier, on May 23, Kulechov committed Aave to a 12-month revenue strategy. My take: ETH traders are really asking one blunt question here. Should Ethereum lean harder into its values, or show clearer cash flows, while ETH trades near $2,136 and is down almost 60% against Bitcoin over five years?

The Ethereum Foundation is choosing the values side. Buterin pointed to Kohaku after contributors had spent close to a year working on it inside the EF. Kohaku focuses on security, including trustlessness, and on privacy for read and write operations at Ethereum’s access layer. Its GitHub README calls it “privacy-first tooling for the Ethereum ecosystem.” The repo includes libraries for Railgun and privacy pools. It also includes a provider abstraction layer and a post-quantum 4337 account implementation. Some parts are not finished yet. That last bit matters.

Ethereum’s market problem is no longer just throughput. It is capital allocation. ETH holders have watched the token trade around $2,136, less than half its level last August, while Bitcoin has won the relative-strength trade for years. A nearly 60% drop in ETH/BTC over five years is not just bored traders complaining on a slow week. It is the market saying Ethereum’s settlement-layer credibility has not translated cleanly into token demand. Harsh, but fair.

Buterin’s answer, at least in his May 25 public statement, was to narrow the EF’s job instead of chasing the chart. He said the foundation is “one node, with a defined purpose, alongside other nodes,” and said EF holds about 0.16% of circulating ETH. The foundation plans to sell fewer tokens while focusing on CROPS: censorship resistance, capture resistance, openness, privacy, and security. Most market notes would call that a weak treasury message. That is only half right. It is weak if you want EF to behave like a price-support desk. It is coherent if you think EF should be the steward of the protocol’s hardest-to-monetize principles.

Here is the awkward part. That position can make sense and still irritate the market. ETH is competing with BTC for crypto-native capital. It is also competing with stablecoins for yield-seeking liquidity and with DeFi tokens such as AAVE for revenue exposure. Why does this matter? Because when ETH underperforms BTC by almost 60% over five years, traders hear every EF statement through one filter: does this help ETH’s monetary premium, fee capture, or institutional bid? Privacy and security may make Ethereum harder to replace over time. They just do not hit the tape like $7.96 million in weekly fees.

Aave is making the cleaner investor pitch. On May 23, Kulechov said the lending protocol would follow a 12-month “revenue-led protocol strategy.” His point was that sustainable revenue can show DeFi moving past token speculation and into businesses with real balance sheets. Aave generated $7.96 million in fees over the past seven days and holds more than $14 billion in total value locked, according to the source’s DeFiLlama data. Its V4 passed $100 million in combined deposits and loans on May 22. I’ll be honest: that is the kind of paragraph investors can actually put into a model.

That is easier to price. Aave has lending activity, a large TVL base, a growing V4 rollout, institutional lending plans, and GHO, its overcollateralized stablecoin. Revenue talk travels better with traders than philosophy talk. AAVE can be debated through fees and deposits. Loans, stablecoin growth, and balance-sheet design give the discussion more handles. ETH is being asked to price a public-good roadmap where the payoff may come through ecosystem durability rather than direct token mechanics. Counter to the usual advice, that does not make ETH less important. It makes it harder to underwrite.

Still, the privacy work is not cosmetic. Buterin’s 2026 roadmap includes account abstraction with FOCIL, a forced inclusion list mechanism, EIP-8250 keyed nonces, and access-layer work like Kohaku. EIP-8250 would replace Ethereum’s single sender nonce with a two-part system meant to stop observers from linking transactions from the same account. Is this just cypherpunk branding? No. Better wallet privacy and security can affect user retention, institutional comfort, and Ethereum’s case as neutral financial infrastructure. We have seen that distinction get missed in Ethereum debates before: traders price the token, but builders price survivability.

The regulatory-pressure angle is hard to ignore. Privacy pools, Railgun libraries, and access-layer privacy tools make Ethereum more useful for people who do not want every transaction linked forever in public. They also make compliance harder for exchanges, institutions, and token issuers building on ETH. The source does not name the SEC or CFTC here, so this is not a fresh enforcement story. It is a design choice that could affect how ETH, AAVE, GHO, and privacy-linked apps are treated by centralized venues and institutional desks. Clean upside? Not exactly.

EF also has an internal credibility problem. At least eight senior contributors have left EF or announced departures in 2026, including five in May. Carl Beek, who spent seven years at the foundation and helped with the Beacon Chain launch, announced his departure on May 18. Julian Ma, a cryptoeconomics researcher who served for four years, announced his departure too. In that context, Buterin’s May 25 defense was not just theory. It was aimed at a community asking whether Ethereum’s core institutions still move quickly enough. I would not separate the staffing story from the market story here; traders rarely do.

Buterin is not saying revenue never matters in Ethereum. He is saying EF should not become the entity responsible for supporting ETH’s price or optimizing around short term market optics. Kulechov is making a different argument at the protocol layer: DeFi needs steady revenue if it wants to look like a real business. Yes, this sounds like a contradiction after all the focus on ETH’s weak price action. It is not. Both views can be true, but markets will not price them the same way, because one produces public infrastructure and the other produces fee data.

What this means

This sharpens Ethereum’s investment debate in 2026. Buterin and EF are putting privacy, censorship resistance, openness, capture resistance, and security first. Kulechov and Aave are talking about revenue, TVL, GHO growth, and institutional lending. ETH near $2,136 is the ticker most exposed to that debate, especially after falling almost 60% against Bitcoin over five years. AAVE is the cleaner trade for investors who want Ethereum ecosystem exposure tied to fees instead of foundation philosophy. My view: clean does not always mean better, but it is easier to buy.

Watch EF’s next privacy updates after Buterin’s May 26 Kohaku post. Watch EIP-8250 and the post-quantum 4337 account work. Then watch whether ETH can get back to last August’s level after trading at less than half of it. For Aave, watch the 12-month revenue strategy that followed Kulechov’s May 23 commitment, V4 growth beyond the $100 million in combined deposits and loans reached on May 22, and weekly fees after the latest $7.96 million print. Where does the market answer first? ETH/BTC. The second answer will be in AAVE’s revenue multiple.