The team that spent the past year leading the Ethereum Foundation’s work on institutional privacy has split off into a standalone company. EthSystems launched Tuesday as an independent, for-profit firm focused on privacy and compliance technology built for institutional activity on Ethereum, with the aim of letting banks and asset managers transact without exposing sensitive details such as trade information or client identities.
The company was founded by Mo Jalil, Oskar Thorén, and Aaryamann Challani. The three built and led the Ethereum Foundation’s Institutional Privacy Task Force, a year-long initiative that involved hundreds of conversations with central banks, regulators, tier-one banks, and asset managers. Jalil, now CEO of EthSystems, previously worked at Goldman Sachs. Thorén said he spent “close to a decade” working on crypto privacy infrastructure, including peer-to-peer messaging and the Waku protocols that are now part of Logos.
In a launch post on X, the company wrote: “Today we’re launching EthSystems. We build confidential systems for institutional Ethereum. Institutions want to use Ethereum, but one of the biggest problems is the lack of built-in, modular privacy tools. We were the Ethereum Foundation’s Institutional Privacy Task Force.”
Ethereum’s institutional privacy gap
EthSystems says its starting point is that Wall Street has accepted crypto as an asset class, but not yet as commercial infrastructure. Banks and asset managers are already exploring stablecoins, tokenized assets, and on-chain settlement, yet the founders argue that none of those institutions will run real flows in full public view.
On a shared public ledger, the main issue is confidentiality. In the company’s view, each party to a transaction should only be able to see the information it has a right to see, and nothing beyond that.
EthSystems begins operations with a year of open-source work already published. That includes proofs of concept for private bonds, confidential stablecoin transfers, private cross-chain settlement, hardened shielded pools, and an Ethereum Privacy Map designed to catalog institutional requirements across the ecosystem.
Its business model is bespoke consulting. The company says it will offer workshops, architecture reviews, protocol specifications, and production systems. In its own framing, it is continuing the same work it was already doing, except now as a paid business. EthSystems also said it plans to keep publishing open-source work alongside commercial engagements.
The latest Ethereum Foundation spin-out
EthSystems is the latest team to break away from the Ethereum Foundation as the organization continues to shrink and restructure in 2026. In June, the Foundation cut 20% of its staff, reduced its budget, wound down its internal privacy and scaling research unit, and reorganized around a leaner mandate after at least nine senior figures left over the course of the year.
Within a matter of weeks, three groups have spun out to take over work the Foundation is stepping back from. Ethlabs, a non-profit, is handling core protocol research. Ethereum Institutional, also a non-profit, is coordinating outreach to banks and asset managers. EthSystems, the for-profit arm among the three, is focused on building applied privacy technology. The company said it left the Foundation on good terms and sees its role as complementary, with an emphasis on “depth over breadth.”
Backers and the bet behind the company
EthSystems is funded by several of the same names backing the other spin-outs: Bitmine Immersion Technologies, Sharplink, Ethereum co-founder Joe Lubin, and Asia-focused investment firm SNZ. Bitmine and Sharplink are the two largest publicly traded Ethereum treasury companies.
The article also disclosed that Lubin, through his company Consensys, and Bitmine Chairman Tom Lee are investors in Dastan, Decrypt’s parent company.
Those backers have a direct interest in the company’s thesis. Bitmine holds about 5.7 million ETH, while Sharplink holds around 888,000 ETH. Both companies have presented Ethereum to public-market investors as settlement infrastructure for stablecoins and tokenized assets.
Tom Lee described EthSystems as filling a missing piece and said in the launch announcement that “the next $100 trillion of assets won’t migrate on-chain without it.”
Lubin, for his part, contrasted the team with others that he said had offered privacy technology to institutions in the form of “permissioned systems with extra steps.”
Privacy as the bridge from billions to trillions
According to RWA.xyz, Ethereum already hosts $16 billion in tokenized real-world assets and $159 billion in stablecoins. Jalil argued that privacy is “the difference between Ethereum holding billions today and running trillions tomorrow.”
That view sits at the center of EthSystems’ launch. The company’s argument is not that institutions lack interest in Ethereum, but that they will not move real transaction flows onto a public blockchain without tools that match their confidentiality and compliance requirements.