The privacy team from the Ethereum Foundation (EF) has officially announced the creation of a commercial company called EthSystems. The new project aims to develop solutions for institutional clients working with the Ethereum blockchain.
The startup has received support from Ethereum co-founder Joseph Lubin, as well as from companies BitMine and SharpLink. The founders are former EF employees — Mo Jalil, Oscar Toren, and Aryamann Challani, who previously led the institutional privacy group within the foundation.
EthSystems will focus on building tools based on zero-knowledge proofs. These solutions will allow banks and asset managers to conduct large transactions on the Ethereum network while keeping details of trading positions and confidential client data private.
The company's business model is built on paid consulting and the development of customized systems. As representatives of EthSystems explained, large businesses need a commercial counterparty for collaboration, not a non-profit foundation. At the same time, the startup will continue to publish protocol specifications in the open domain.
Key Quote
"Privacy is not just an option, but a key requirement. Without data protection, large financial organizations will not move to the blockchain," said EthSystems CEO Mo Jalil.
Before the public launch, the team worked on open-source code for a year. Protocols for private transfers, bond issuance, and identity systems have already been presented.
The launch of EthSystems comes amid a large-scale restructuring of the Ethereum Foundation. Last month, the foundation cut 20% of its staff and reallocated resources across five main areas. Alongside EthSystems, other independent structures have emerged in the ecosystem — EthLabs and Ethereum Institutional.
Recall that in June, a proposal was discussed on the Ethereum Research forum to redirect up to 10% of validator staking rewards to fund the ecosystem.
Analyst Comment: The emergence of EthSystems is a logical step in the evolution of Ethereum. The foundation is deliberately delegating the commercialization of key technologies (in this case, privacy) to external teams, while retaining its research function. However, the startup's success will depend on how quickly banks and institutional players are willing to pay for these solutions, rather than waiting for free open-source alternatives.