EthSystems Emerges as For-Profit Entity from Ethereum's Privacy Initiative

Summary

• EthSystems has been established to develop privacy solutions for institutional Ethereum, emerging from the Ethereum Foundation's Institutional Privacy Task Force.
• It is the first for-profit venture from the Foundation this summer, backed by Bitmine, Sharplink, and co-founder Joe Lubin.
• The firm aims to address institutions' concerns about using stablecoins and tokenized assets on public ledgers due to privacy issues.

EthSystems, a new for-profit company focused on enhancing privacy for institutional use of Ethereum, officially launched on Tuesday. The firm was founded by members of the Ethereum Foundation's Institutional Privacy Task Force, which dedicated the past year to developing privacy technologies that would allow banks and asset managers to operate on Ethereum without exposing sensitive information.

Led by CEO Mo Jalil, along with co-founders Oskar Thorén and Aaryamann Challani, the team has extensive experience in the field. Jalil previously worked at Goldman Sachs, while Thorén has spent nearly a decade on crypto privacy infrastructure development.

Today marks the launch of EthSystems.

We are focused on creating confidential systems for institutional Ethereum.

While institutions are interested in utilizing Ethereum, a significant challenge remains: the absence of integrated, modular privacy tools.

— EthSystems (@eth_systems) July 14, 2026

The Privacy Challenge in Ethereum

The founders of EthSystems highlight that, despite Wall Street's growing interest in cryptocurrency as an asset class, financial institutions are reluctant to use it as a commercial infrastructure due to privacy concerns. They argue that confidentiality is essential for significant transactions on public ledgers, where participants should only see what they are entitled to view.

EthSystems has begun with a range of open-source contributions, including prototypes for private bonds and confidential stablecoin transfers. The company plans to monetize its expertise through customized consulting services while continuing to provide open-source resources.

Another Spin-Out from the Ethereum Foundation

EthSystems is the third group to spin out from the Ethereum Foundation in recent weeks, following a restructuring that saw a significant workforce reduction and budget cuts. The Foundation has been focusing on a more streamlined approach after losing several senior members.

EthSystems left the Foundation amicably and sees its mission as complementary, emphasizing depth in its initiatives. The company is backed by investors including Bitmine and Sharplink, both of which hold substantial Ethereum assets and support the notion of Ethereum as a settlement framework for stablecoins and tokenized assets. Joe Lubin remarked that EthSystems addresses a crucial need for institutional privacy solutions, contrasting it with existing offerings that lack comprehensive privacy features.

Currently, Ethereum supports approximately $16 billion in tokenized real-world assets and $159 billion in stablecoins. Jalil stressed the importance of privacy, stating it could significantly impact Ethereum's future growth potential, suggesting that it is vital for scaling from billions to trillions in assets on the platform.