New EthSystems Venture Tackles Ethereum Privacy Gap for Banks
EthSystems has launched with backing from Bitmine, SharpLink and Joe Lubin to build the privacy infrastructure that institutions say is required before adopting Ethereum for mainstream settlement.
EthSystems has launched to build privacy infrastructure for Ethereum, backed by Bitmine, SharpLink and Ethereum co-founder Joe Lubin. The company is led by Mo Jalil, Oskar Thorén and Aaryamann Challani, the team that previously built and led the Ethereum Foundation's Institutional Privacy Task Force.
The venture targets a fundamental barrier preventing large financial institutions from using public blockchains. While banks and asset managers are increasingly drawn to the 24/7 settlement capabilities of stablecoins and tokenized funds, they remain reluctant to execute trades on networks where client identities and commercially sensitive details are publicly visible.
EthSystems is developing private transfers, confidential settlement, privacy-preserving identity tools and private bond infrastructure. The technology is designed to restrict data access so each participant sees only the information it is authorized to view. This architecture aims to maintain Ethereum’s core decentralization and security while adding commercial confidentiality.
The founders' argument is finding traction among their backers. Jalil called privacy "the requirement" for institutions, arguing that "central banks, governments and asset managers will not move meaningful operations onchain if every transaction is exposed." Bitmine Chairman Tom Lee said "Ethereum's institutionalization depends on privacy and security infrastructure built to the standards large financial firms expect," while SharpLink CEO Joseph Chalom added that "confidentiality will be needed before the network's broader financial opportunity can be realized."
The launch reflects a maturing division of labor within the broader Ethereum ecosystem. While Ethlabs handles underlying protocol research and Ethereum Institutional manages market engagement, EthSystems is positioned at the deployment stage. Its mandate is translating complex institutional compliance requirements into functional production systems.
Ethereum is already functioning as a settlement layer for tokenized assets. As the network attempts to capture the next wave of institutional capital, EthSystems is betting that making that activity private is the only way to drive adoption at scale. Ether was recently trading at $1,874.85.
