Emerging from the Ethereum Foundation, EthSystems is dedicated to developing privacy solutions for financial institutions.
By Margaux Nijkerk|Edited by Sheldon Reback Jul 28, 2026, 3:46 p.m. 3 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on (Ethereum)SummaryShow- EthSystems, a new venture from the Ethereum Foundation, is aiming to create privacy frameworks for financial institutions, asserting that confidentiality is the primary challenge to integrating real-world finance with public Ethereum.
- Co-founder Mo Jalil noted a shift in institutional interest from blockchain experimentation to the deployment of privacy tools that comply with regulatory standards.
EthSystems, recently established as a spinout of the Ethereum Foundation, is making a strong case that the lack of privacy, rather than scalability, is the main barrier that prevents institutions from adopting public blockchains for their financial operations.
The startup, which originated from the Ethereum Foundation's Institutional Privacy Task Force, is focused on developing privacy solutions for banks, asset managers, and governmental bodies interested in utilizing Ethereum for various financial applications including tokenized assets and stablecoins.
Instead of launching a new blockchain, EthSystems provides institutions with privacy technologies that keep transaction data secure while still utilizing the Ethereum network.
According to co-founder Mo Jalil, "Almost every single financial institution requires some level of confidentiality. Confidentiality doesn't necessarily mean something has to be anonymous or hidden. There just needs to be controls over who sees what, when, and how."
EthSystems is not alone in the quest for institutional privacy; other initiatives like Canton Network, supported by major financial players such as Goldman Sachs and BNP Paribas, as well as Ethereum-based privacy solutions like Aztec and Miden, are also working on tools for enabling secure transactions for businesses.
What sets EthSystems apart is its commitment to guiding institutions in developing privacy architectures, creating tailored solutions when necessary, and sharing open-source research on blockchain adoption for institutional use. The company aims to collaborate with existing privacy initiatives rather than competing with them, offering integration and recommendations based on client requirements.
"We don't have one specific product; we have several, and we'll collaborate with the existing privacy ecosystem instead of trying to reconstruct the entire privacy stack," Jalil explained.
EthSystems emerged as part of a broader restructuring at the Ethereum Foundation, which aimed to distribute responsibilities that were previously centralized within the nonprofit. Unlike its sister entities, EthLabs, which concentrates on protocol development, and Ethereum Institutional, which manages enterprise engagement, EthSystems is solely focused on privacy and cryptography for institutional clients.
The decision to transition into a for-profit entity was motivated by the demand the team encountered while still part of the foundation. "We'd build these proof-of-concepts, and then institutions would ask, 'Can we pay your team to take this into production?'" Jalil recounted. "Every time I'd have to say, 'That's not something we do.'"
By operating as a commercial entity, Jalil believes it simplifies the funding of their initiatives and facilitates engagement with large financial institutions' procurement processes.
"It just seemed like a more sustainable model," Jalil stated. "You can get financial institutions to fund your vision by delivering the work they require and charging them for it."
The demand from institutions has notably evolved in the past year. Initial discussions were primarily with innovation teams exploring blockchain technology, while current conversations now involve business units that oversee trading and asset management.
"Their experimentation phase is over. Now it's actual personnel who want to bring assets on-chain and manage real financial flows on-chain," Jalil noted.
This shift reinforces EthSystems' primary argument: institutions no longer need persuasion regarding the potential of blockchain; they require infrastructure that meets both regulatory and privacy standards.
"The only way to bridge the gap between public blockchains and institutional control is with cryptography and privacy," Jalil concluded.
Read more: Ethereum Foundation spinout EthSystems targets banks with blockchain privacy technology
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