With over $12.2 billion in Total Value Locked (TVL), EigenLayer is one of the leading Ethereum (ETH) restaking protocols. Despite this, the company behind it, Eigen Labs, has recently cut a significant portion of its staff to prioritize different areas. Although accompanied by a nice severance package, this turn of events is not unfamiliar to the crypto space lately. What Caused The Shift In a post on X yesterday, Sreeram Kannan, the CEO of Eigen Labs, shared the unfortunate news. Today is one of the hardest days we’ve had at Eigen Labs. This morning, I shared plans for a restructuring of the company, streamlining our operations, and concentrating our efforts on building and scaling EigenCloud. Unfortunately, this means saying goodbye to brilliant… — Sreeram Kannan (@sreeramkannan) July 8, 2025 This decision appears to be centered on a new company goal, rather than financial considerations, which is to “build the world’s first verifiable cloud platform,“ as further commented by Kannan in his post. The workers who will be leaving the project will remain supported by Eigen Labs, which has pledged to continue providing them with healthcare, accelerated vesting, and career support, in addition to three months’ base pay. Various individuals from the crypto space have also come to the aid of the affected by commenting on the post, offering to take them on in various roles they have available in their own companies and ventures. This restructuring follows a $70 million investment in the form of EIGEN tokens from Venture Capital (VC) company Andreessen Horowitz’s blockchain-focused arm, a16z, which enabled the launch of EigenCloud, released just last month. The direct token purchase aligns directly with EigenLayer’s economic model, as their Cloud product will feature new fee flows that support staking. This influx of capital follows one from earlier in February, which was for $100 million, again, from the VC firm. EigenCloud is built on top of EigenLayer’s restaking protocol, integrating data availability (EigenData), general computing (EigenCompute), and dispute solving (EigenVerify) into a single platform. This will enable developers to verify what happened both on and off-chain, with the same guarantees typically only available on-chain. A Familiar Direction This layoff reflects a broader downtrend in the crypto sector in 2025, with companies scaling back or refocusing efforts due to various factors. Earlier in April, the Kraken exchange laid off hundreds of roles, with the goal being “to be leaner,” reducing redundancies. In January, the market intelligence platform Messari underwent a reorganization, resulting in a 15% reduction in personnel, affecting both full-time staff and contractors.