The team responsible for privacy at the Ethereum Foundation has officially split off and launched a commercial project called EthSystems. This is not just another startup — it is the first step toward transforming the foundation's internal developments into a market product for large capital.
The founders are Mo Jalil, Oscar Thorens, and Aryaman Challani — key figures from the EF's institutional privacy group. Financial support for the project came from Ethereum co-founder Joseph Lubin, as well as mining company BitMine and investment firm SharpLink.
Zero-Knowledge as a Standard for Banks
EthSystems will focus on developing solutions based on zero-knowledge proofs (ZK-proofs). The main goal is to enable banks and asset managers to conduct large transactions on the Ethereum network without revealing deal details or confidential client data.
Project CEO Mo Jalil emphasizes: "Privacy is not just an option, but a key requirement. Without data protection, large financial organizations will not move to blockchain." This is an absolutely correct stance: as long as public blockchains remain "glass houses," institutional money will keep its distance.
Business Model: Consulting and Open Source
The company has chosen a hybrid strategy. The main revenue will come from paid consulting and the development of customized systems on demand. However, all protocol specifications will remain open source — this preserves community trust and accelerates the adoption of standards.
Interestingly, the team had already been working on open-source code for a year before the official announcement. The startup's portfolio includes protocols for private transfers, bond issuance, and identity systems.
Ethereum Foundation Restructuring Bears Fruit
The launch of EthSystems comes amid major changes at the Ethereum Foundation. Last month, the foundation cut 20% of its staff, reallocating resources across five key areas. Alongside EthSystems, independent structures EthLabs and Ethereum Institutional have emerged in the ecosystem — all targeting the same institutional "supercycle."
Additionally, in June, a proposal was discussed on the Ethereum Research forum to redirect up to 10% of staking validator rewards to fund ecosystem projects. This shows that the foundation is systematically preparing to hand over initiative to commercial players.
My comment: EthSystems is a logical and timely step. The Ethereum Foundation, as a non-profit organization, could never fully work with banks: they need a counterparty with contracts, guarantees, and SLAs. Now this gap is being filled. If the startup's ZK solutions truly prove to be convenient and secure, we may see the first real influx of institutional capital not through ETFs, but through direct on-chain transactions.