announcement<\/a> from EthSystems on Tuesday, the for-profit company will build confidential infrastructure for banks, asset managers, and other regulated institutions using Ethereum.<\/p>\nBitmine and SharpLink, two major Ethereum treasury companies, have backed the venture alongside Lubin, who co-founded Ethereum and later founded Consensys.<\/p>\n
EthSystems was spun out of the Ethereum Foundation and was established by former Foundation employees Mo Jalil, Oskar Thor\u00e9n, and Aaryamann Challani. The three founders previously worked on the Foundation\u2019s Institutional Privacy Task Force.<\/p>\n
EthSystems targets confidential institutional finance<\/h2>\n
The company said it will help financial institutions use public Ethereum without exposing sensitive information such as trading positions, transaction details, or client identities to the full network.<\/p>\n
Its work is expected to include privacy systems based on zero-knowledge cryptography, which can verify transactions without revealing the underlying data.<\/p>\n
\u201cThe business model is simple: bespoke consulting, focused on solving the hardest blockers for institutional adoption,\u201d the team wrote.<\/p>\n
\u201cIn practice, this means continuing a lot of the work we have been doing, only charging money for it,\u201d it added. \u201cCommercial engagements often require a commercial counterparty.\u201d<\/p>\n
Alongside paid consulting, EthSystems said it will continue publishing protocol specifications and contributing to open-source projects.<\/p>\n
While working within the Institutional Privacy Task Force, the founders held hundreds of discussions with central banks, regulators, and financial institutions, according to the company.<\/p>\n
Their previous work included private bonds using zero-knowledge proofs, confidential stablecoin transfers, private cross-chain settlements and the Ethereum Privacy Map.<\/p>\n
\u201cOur mission: help institutions build confidential systems on public Ethereum without giving up what makes Ethereum worth using,\u201d the team wrote.<\/p>\n
<\/p>\n
EthSystems has emerged during a major reorganization of the Ethereum Foundation and its technical teams.<\/p>\n
On June 23, the Foundation cut 54 jobs, equal to about 20% of its workforce, after a months-long review of its spending, staffing and long-term responsibilities.<\/p>\n
The organization reorganized its work into five divisions covering protocol, access, users, community, and institutional activity. Separate groups continue to manage operations and administration.<\/p>\n
The Foundation said the restructuring would allow it to direct staff and resources towards responsibilities that it believes only the organization can perform.<\/p>\n
\u201cThese decisions were hard, but they are necessary,\u201d the Foundation said in June. \u201cWe must be resourced and organized in a way that allows us to focus on the critical work that only EF can, and therefore must, do in the coming years.\u201d<\/p>\n
In July, the Foundation also dissolved its Protocol Support team, which had coordinated All Core Developers meetings, network upgrade tracking, Ethereum Improvement Proposal support, Forkcast, and the Ethereum Protocol Fellowship.<\/p>\n
Mario Havel, who worked with Protocol Support for more than five years, said he remained at the Foundation but confirmed that the rest of the team had been dissolved.<\/p>\n
\u201cI am still part of EF, continuing my work and figuring out what\u2019s most needed in the future,\u201d Havel wrote on X. \u201cHowever, all of my team, Protocol Support, that I have been part of for 5+ years, has been dissolved.\u201d<\/p>\n
Independent Ethereum groups take on new roles<\/h2>\n
EthSystems joins Ethereum Institutional and EthLabs, two other independent organizations backed by Bitmine, SharpLink, and Lubin.<\/p>\n
EthLabs is expected to take on major Ethereum protocol research and development work, while Ethereum Institutional has been positioned as a neutral contact point for financial companies building on the network.<\/p>\n
Lubin previously told The Block that he expected at least three organizations to emerge from the Foundation as it concentrated on censorship resistance, open-source development, privacy, and security under its CROPS framework.<\/p>\n
\u201cAs EF continues doubling down on cypherpunk fundamentals, especially with a focus on individuals, there\u2019s room for an independent for-profit entity that can make different choices in the trade-off space,\u201d EthSystems wrote.<\/p>\n
Despite the restructuring, the Foundation\u2019s protocol division remains responsible for Ethereum\u2019s core technology, including privacy, security, decentralization and censorship resistance.<\/p>\n
Ethereum developers are also continuing work on the Glamsterdam upgrade, which includes proposed changes to block construction, data access, and network performance.<\/p>\n
<\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"
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