ETH Systems Co-Founder Dialogue: What On-Chain Features Does Ethereum Still Need to Bring to Wall Street?

Bringing trillions of institutional assets on-chain with privacy cryptography.

Source: Bankless

Compiled by: Blockchain Simplified

The public chain's "complete transparency" was once Ethereum's proud banner, but it has now become a fatal shackle preventing trillions of traditional capital from entering the market—on-chain, a large transfer can even lead to the entire institution's trading strategy being instantly targeted by the whole network.

How can Wall Street giants embrace Ethereum without exposing their business secrets while meeting stringent compliance requirements?

ETH Systems, which officially split from the Ethereum Foundation, is providing the ultimate solution to the decentralized world. In this article, the two founders, who span top investment banks and the forefront of core cryptography, will deeply reveal how they break the paradox of "privacy and transparency cannot coexist" through modern zero-knowledge proofs, outlining a future blueprint for the entire industry to bring trillions of institutional assets on-chain in compliance.

Origin and Mission: Why Ethereum Needs Institutional-Level Privacy

David: Welcome to Bankless. Today, I am joined by Mo Jalil and Oscar Thorne. They are the co-founders of ETH Systems, a new team that has officially split from the Ethereum Foundation, focusing on three things: Ethereum, institutions, and privacy. I believe this is extremely urgent for the entire crypto industry, and Ethereum is no exception, as it is the key piece that truly elevates the Ethereum ecosystem to the next level. Oscar, Mo, welcome to Bankless.

Oscar: David, thank you for the invitation.

Mo: Thank you, David.

David: Let's get straight to the point: Why does Ethereum urgently need privacy? Oscar, I'll throw this question to you first.

Oscar: Ethereum is an excellent underlying technology and operates extremely stably as a trusted, neutral decentralized base layer. However, it does not have built-in privacy protection mechanisms at the protocol level. Therefore, many people are trying to fill this gap, whether exploring at the base layer or developing various solutions at the application layer. It can be said that privacy is currently the most critical missing piece in the Ethereum and public chain landscape. And this is where we come in.

For us, the core focus of the team is institutions. Large institutions typically care about two things: the continuity and security of their core business, and strict compliance requirements. Because of these constraints, traditional institutions have tended to choose private networks or consortium chains that they can fully control for a long time.

At the same time, the public chain Ethereum has deep global liquidity, new business collaboration opportunities, and enormous potential to optimize its existing business models. Without modern cryptography as a bridge, institutions cannot enjoy the liquidity of public chains while meeting compliance and business confidentiality protection requirements. They must have these privacy computing capabilities to truly embrace the significant benefits brought by the public chain Ethereum.

David: Can you talk about your backgrounds? For you, ETH Systems may be a new entity that has just been established for a month, but this is clearly a natural extension of your long-term deep engagement in the technology arc. We need to understand what experiences you have accumulated in Ethereum, cryptographic privacy, and traditional financial institutions, and how these experiences have converged into ETH Systems. Mo, please start.

Mo: I initially started in traditional finance, building quantitative algorithmic trading systems at top investment banks like Goldman Sachs for about five years. That experience gave me a deep understanding of the real needs and pain points of these large investment banks in system architecture, matching and clearing, and risk control compliance. I then worked in the hedge fund industry for a few years. For me, that cross-industry experience was very interesting.

I was always tracking cutting-edge technology, and I remember being very shocked when I first read the Bitcoin white paper, but at that time, it was clearly too early to use public chains in core financial business. Several years later, I joined the Ethereum Foundation, responsible for a lot of business development work at the application layer. At that time, Tomas was the co-executive director. During that work, one thing became incredibly clear: any large traditional organization that wants to truly use the public chain Ethereum must have privacy protection and modern cryptographic solutions as rigid prerequisites. I have known Oscar for many years, and at that time, I called him directly: Oscar, there is something crucial for the future of the entire ecosystem that is extremely suitable for your background, we must sit down and discuss it in depth.

Oscar: I have been deeply involved in the crypto field for about ten years. I started focusing on privacy technology long ago when privacy was far from a hot topic in the community. I worked at Status early on and later created a research and development lab. During this time, we led the development of various peer-to-peer communication protocols, focusing on censorship resistance, data availability, and communication privacy as underlying facilities. Therefore, I have accumulated a long period of engineering experience in protocol design, cryptographic privacy, and censorship-resistant network architecture.

In the last five to six years, I have fully immersed myself in the field of zero-knowledge proofs, developing various development tools and infrastructure, including deep collaboration with early members of the Ethereum Foundation's PSC (Privacy & Scaling Explorations). I also wrote a small book on proof systems, conducted research on polynomial commitment schemes, and led the development of tools to reduce client proof complexity. In recent years, I served as a privacy strategy advisor at the Ethereum Foundation, mainly responsible for the new access layer architecture. As Mo mentioned, we initiated the institutional privacy working group during our time at the foundation.

For me personally, my focus has primarily been on personal sovereignty and user-level privacy, which remains a principle in my heart. However, in recent years, I have clearly observed that the demand for privacy from institutions not only exists but is often more urgent than that of individual users in many business scenarios. This is directly related to the gradual clarity of global regulatory frameworks in recent years. Many leading institutions are very concerned about the commercial backlash caused by on-chain data exposure. For the past year, we have been publicly building this solution within the foundation, and about a month ago, we officially split it into an independent entity.

Mo: One additional point. When we split off to establish ETH Systems, we did not start from scratch but brought in a whole year of solid research and delivery results: including multiple closed-door workshops, practical cooperation cases with numerous financial entities, and already published public products (such as mapping various real financial use cases to Ethereum privacy solutions' market panorama), as well as in-depth technical architecture analyses on private distribution, public chain ledgers compared to private execution tracks, etc. Although the independent brand ETH Systems is very young, it is backed by years or even decades of cryptography and financial engineering accumulation.

Strategy and Status: From Theoretical Research to Engineering Implementation

David: Oscar just mentioned two very critical points: first, the foundation's privacy strategy, and second, the essential differences between institutional privacy and personal privacy. Let's start with the privacy strategy. What exactly is a privacy strategy? How do you define it in practice?

Oscar: This relates to the research and development environment of the PSC team at the Ethereum Foundation at that time. We were trying to bring cutting-edge cryptographic work deeper into the foundation's macro vision, systematically thinking about which privacy research directions the foundation should prioritize. Of course, many teams in the ecosystem are already pushing forward, and I don't want to overly represent the foundation.

As the head of the institutional privacy working group at that time, our core mission was to connect two long-separated worlds: one side is traditional large institutions, and the other side is the Ethereum native ecosystem. When we communicated with financial institutions early on, they often had a huge information gap regarding Ethereum, generally believing that "this is just a completely transparent public chain with no commercial privacy whatsoever." But in reality, the Ethereum ecosystem has already accumulated extremely rich solutions in underlying cryptographic primitives, professional security vendors, and various layered privacy protocols.

What we did was, on one hand, systematically break down the entire picture of Ethereum's privacy technology stack for institutions; on the other hand, clearly translate to crypto teams and protocol engineers within the ecosystem: what these real trillion-level commercial users are actually looking for. Therefore, we mapped out a segmented privacy market map, systematically sorting out the specific needs of traditional institutions in specific business processes, legal compliance constraints, and trading scenarios, and then accurately mapping them to existing technologies such as zero-knowledge proofs, secure multi-party computation, or homomorphic encryption, indicating the missing components to the industry through concept validation and architectural white papers and how to piece these cryptographic blocks together.

Mo: I want to quickly add something. Oscar just mentioned PSC, and some listeners may not be familiar with this organization. The Ethereum ecosystem has actually been deeply engaged in privacy and scaling technology for many years. Although privacy protocols have recently become a hotspot for capital and technology, the Ethereum Foundation had already established a laboratory focused on cryptographic research internally, which is PSC. They can be seen as Ethereum's privacy steward, gathering a group of core builders who have long focused on cryptographic theory and the implementation of privacy protocols.

David: According to your observations, does the industry already have ready-made code solutions that institutions can directly use if they know they exist and follow the guidelines? Or is there still a significant underlying gap in building enterprise-level confidential systems on Ethereum? At what stage are we currently in this technological evolution arc: do we still need to break through underlying cryptographic theories, or is the infrastructure basically in place, mainly lacking standard formulation and module assembly?

Oscar: This is a very profound question. I believe the current reality is a mix of both. Over the past decade, the Ethereum Foundation, the Zcash ecosystem, and many independent cryptographic teams have successfully engineered a large number of cutting-edge cryptographic primitives, transforming them from pure theory into highly usable code. Around these underlying breakthroughs, a number of technology service providers dedicated to lowering integration barriers have also emerged in the market. In many standard scenarios, we indeed already know how the technical path should go.

However, when faced with the complex constraints of specific institutions, there is still a significant engineering gap. Many traditional institutions have extremely strict and counterintuitive business constraints, and general standardized solutions often cannot be directly adapted. The outside world may simply think that "deploying a privacy Layer 2 for institutions can solve everything," but once you delve into the real trading processes, general Rollups often come with trade-offs that institutions cannot accept in terms of latency, liquidity fragmentation, or compliance permissions.

When we connect with these institutions, we find that there is a significant divergence in digital maturity among the parties: leading institutions may have built R&D labs with dozens of people, equipped with top cryptographic PhDs, and have been tracking zero-knowledge proofs for years; while on the other end, traditional institutions may have no Web3 R&D capabilities at all and only hope to procure off-the-shelf compliant infrastructure. Different clients have vastly different demands for performance throughput, deterministic settlement times, and security assurance levels, which determines that we cannot adopt a one-size-fits-all approach.

Mo: From the institutional cases we have closely followed, the current bottleneck is essentially no longer a purely theoretical problem of cryptography, but rather an extremely complex issue of system engineering implementation and architectural adaptation. The Ethereum ecosystem has already taken the lead in research, and the remaining most challenging task is to securely integrate these building blocks into the infrastructure of modern finance.

Real Battlefield: Pain Points of Investment Banks and the Path to Customized Solutions

David: Since the core challenge lies in engineering, could you break down a typical real case you encountered? What are the most common privacy demands from large institutions when connecting to Ethereum? Is it the confidentiality of corporate stablecoin account balances, the prevention of asset penetration during the issuance of real-world assets (RWA), or private settlement in B2B supply chain scenarios? What type of demand do you most frequently handle in practice?

Mo: The institutional use cases we encounter are extremely diverse. Frankly speaking, our team usually focuses on those tough problems that have not yet been tackled by existing market solutions. Use cases like basic private transfers and tokenized deposits that you just mentioned already have some preliminary solutions in place and have been partially resolved within certain compliance-friendly countries and organizations. We are more concerned with those systemic pain points that are huge in the traditional financial world but have not been seriously addressed in the public chain space.

A representative real case: We once had an in-depth discussion with a top-tier global investment bank about the "inter-dealer compression" business. In the traditional derivatives and foreign exchange markets, major banks generate massive bilateral exposures every day. At the end of each trading day, to reduce capital usage and default risk, all participating banks send their large trading data to a trusted centralized clearing service provider. As a result, these top financial institutions need to pay tens of millions or even hundreds of millions of dollars annually to third parties for these expensive services.

This centralized third party reviews the sensitive trading details and real-time positions of each bank, completing netting and position compression in the background. Although no major bank is willing to fully expose its underlying trading cards to a third party, the industry has to compromise because position compression can significantly reduce capital adequacy ratio usage and the number of transactions that need to be actually cleared.

An executive from this investment bank approached us with a request: Is it possible to completely eliminate this centralized intermediary using cryptographic technology? The decentralized network built on Ethereum, which is immutable and shares a global state, is the ideal foundation to solve this problem. However, the core obstacle is: if these sensitive data are directly submitted to the public and transparent Ethereum mainnet, competitors around the world will have a clear view of each bank's real positions. This is a typical real scenario with potential value in the hundreds of billions of dollars that has previously received little attention from native crypto teams.

In the field of private payments and settlement, we have also conducted multiple rounds of architectural validation with large institutions from various sovereign jurisdictions. As Oscar mentioned, although the concept of private payments sounds standardized, the specific regulations in different countries regarding financial supervision, anti-money laundering penetration, and foreign exchange control impose multidimensional complex constraints on what would otherwise be a simple cryptographic model.

Oscar: Building enterprise-level confidential systems is far more than just introducing a zero-knowledge proof. Besides data privacy, institutions are also extremely concerned about system high availability, deterministic security boundaries, censorship resistance, and compatibility with existing settlement systems. Many times, our work is about enhancing the rigor of the entire Web3 industry in engineering specifications and system delivery.

These traditional giants have already validated the product-market fit (PMF) in their existing businesses, with internal systems handling billions of dollars in fund flows daily. When they consider migrating their business to the Ethereum ecosystem, their primary demand is to achieve 100% system determinism. This is fundamentally different from the early industry logic of intuitive, rapid iterative experimental development. Privacy is the most technically challenging aspect, but it is just one core attribute of the overall highly available distributed system. We must provide rigorously formalized technical specifications that comprehensively cover various boundary conditions.

David: Is there a case that has completed the entire process from demand communication, technical validation to actual implementation? Can you share a complete journey of an institution successfully linking to Ethereum using your privacy solution?

Mo: Under strict confidentiality agreements, I can share a real case of a national financial infrastructure. In many mature economies, the logic of peer-to-peer payments is straightforward, but in certain specific jurisdictions, the regulatory logic is entirely different. A large financial institution in that country wanted to promote a blockchain-based underlying payment network nationwide. They fully recognized the efficiency of public chains in inter-institutional settlements, but the system must support high-concurrency transactions for a population of tens of millions while meeting the unique compliance audit framework of the country.

In a standard cryptographic privacy payment model, it typically only needs to satisfy bilateral confidentiality and verification between the sender and receiver. However, the financial regulatory laws of that country explicitly state that each transaction must inherently support the collaborative interaction of four entities at the cryptographic level: the fund sender, the fund receiver, the licensed compliance auditing agency, and the national regulatory authority.

This institution has tried almost all mainstream privacy protocols and scaling networks in the market over the past two to three years, but none could balance throughput, deterministic latency, and controllable on-chain computation costs while ensuring controlled disclosure for all four parties. They even wrote a detailed technical assessment report dozens of pages long, arguing why this goal could not be achieved within the existing public chain system.

The turning point was when our team publicly released a series of research articles and proof-of-concept codes on multi-party private state transitions during our time at the Ethereum Foundation. The technical director of that institution proactively reached out to us after seeing these open-source results, stating that this breakthrough from the foundation made them see the technical feasibility of building a nationwide clearing network based on Ethereum. They are currently advancing the deployment based on our open-source architectural blueprint. This case not only breaks the prejudice that public chains cannot meet complex sovereign compliance but also avoids the country regressing to a completely closed and fragmented traditional private chain system.

Oscar: The business and technical validation cycles for such institutional-level collaborations are very long, often requiring extensive compliance reviews, legal assessments, and security audits. During my time at the foundation, many deeply collaborating institutions often expressed a willingness to obtain our deeper architectural support through commercial procurement, but the foundation, as a neutral non-profit organization, could not accept commercial contracts, leading to many projects that could have been implemented stalling at the last mile. This is precisely why we chose to split the team into an independent profit-making entity: to connect traditional institutions with mature commercial contract structures while continuing to feed back into the public chain ecosystem through open source.

Scaling Paradox: Balancing Deep Customization and Universal Standards

David: Hearing this, I have a core concern: If you must do a lot of highly customized development for each jurisdiction and each unique compliance requirement, how can the entire business achieve network effects and scalability? It is often said in the industry that a glove that fits perfectly for one hand often only suits that one hand.

Another evolutionary path is: What if we directly embed native privacy into the core infrastructure of Ethereum—such as enabling Uniswap, Aave, the basic EOA account system, and Ledger hardware wallets to have high-fidelity, out-of-the-box privacy protection capabilities? Would institutions then be able to directly adapt to this unified standard? If everyone operates under the same universal standard, the overall privacy liquidity of the Ethereum ecosystem could experience explosive growth. How do you balance this scalability contradiction between deep customization and universal standards?

Mo: This is a very profound industry proposition. First, the implementation of customization and the advancement of underlying universal standards are not mutually exclusive. The strength of the Ethereum ecosystem lies precisely in its ability to evolve collaboratively across multiple layers. Second, the so-called "specific customization market" is often a huge independent industry in the traditional financial world, with a scale reaching hundreds of billions of dollars.

We do not advocate for endless pure outsourcing customization, as that is not a healthy business model. The core strategy of ETH Systems is: first, to root in the front line and thoroughly understand the most challenging vertical scenarios, because only by fully understanding the business details can we design truly usable cryptographic architectures; then, we immediately abstract highly universal underlying cryptographic building blocks and protocol standards from these high-barrier scenarios.

For example, the previously mentioned "inter-dealer compression" protocol, once successfully implemented in a leading investment bank, can directly be reused horizontally for all major investment banks globally; the "multi-party controlled compliance disclosure protocol" developed for sovereign-level payments can also be completely abstracted as a standard module serving compliant stablecoins in various regions worldwide.

Our long-term path is very clear: all core algorithms and universal interfaces that have been validated in practice will be contributed to the Ethereum community under the most permissive open-source licenses, thus completely dispelling institutions' concerns about proprietary technology lock-in; at the same time, we will package these audited components into high-performance, pluggable modular kits. This approach is similar to the "navigating the cognitive maze" methodology in Silicon Valley entrepreneurship: in the early stages, the team must personally engage in those seemingly unscalable tasks that can accumulate the highest cognitive barriers.

Facing traditional financial giants that have been operating stably for over a hundred years, the public chain ecosystem cannot arrogantly demand that they completely start over to adapt to Web3, but must build a smooth transitional technical bridge based on their existing business interfaces and legal frameworks.

Oscar: I completely agree with Mo's viewpoint. The crypto industry has generally adhered to the idealistic logic of "as long as the underlying universal infrastructure is built well, applications and users will naturally come." But the reality has proven that this logic often fails when facing institution-level users with strict regulations and complex businesses.

First, tackle the extremely complex specific scenarios, and then distill and generalize them into universal standards is a path of great engineering value. We are achieving this goal by releasing open-source code libraries, modular protocol blueprints, and highly scalable technical specifications. Of course, we are extremely eager to see the Ethereum base layer (L1) natively support more privacy primitives in the future, which would greatly expand the application boundaries of the entire decentralized world. But at this stage, our primary strategic focus remains: to clear all obstacles and safely and smoothly bring trillions of dollars of real institutional assets into the Ethereum ecosystem.

David: In terms of business model positioning, does ETH Systems lean more towards a consulting studio providing customized technical delivery for traditional financial institutions, or is it closer to product-oriented tech companies like Uniswap Labs or Aave Companies that obtain scalable value by building standardized products on-chain?

Mo: Our self-positioning is very clear; we are always a purely product-oriented company. I served as the Chief Technology Officer in my previous job, and my career has been focused on building scalable software products; Oscar also has a long background in product architecture and protocol development. We understand that only standardized products can bring about exponential network effects.

However, the path to excellent products involves an inevitable evolutionary spectrum. At the intersection of Ethereum and traditional finance, you cannot sit in an ivory tower and imagine demands out of thin air. The team must act as frontline deployment engineers, diving deep into Wall Street trading desks and compliance offices to observe the intricate details of interactions between traders and clearing systems. The ultimate goal of all customization explorations is to crystallize standardized infrastructure products that can be distributed at scale.

Oscar: The procurement and decision-making cycles of traditional institutions are inherently very lengthy. Through early deep technical collaborations, proof of concepts, and joint architecture reviews, we can gain unprecedented insights into the rigid demands of the real world, ensuring that we have a high competitive barrier when deciding to bet on core products. This deep feedback loop is something that purely external teams cannot obtain.

Endgame Simulation and Future Ecology: Redefining the Boundaries of Transparency and Trust

David: Looking at the entire macro cycle, how has the willingness of traditional institutions to decentralize accounting on public chains changed? In your daily business communications, are you more often actively promoting Ethereum, or are institutions actively seeking compliant on-chain solutions?

Mo: In fact, the vast majority of demands come from institutions reaching out to us. First, mainstream financial institutions worldwide have fully understood the immense value of decentralized shared ledgers in eliminating reconciliation costs and achieving real-time atomic settlement over the past few years. Second, we must objectively credit the entire native DeFi ecosystem: when traditional institutions see the incredible resilience and capital efficiency demonstrated by decentralized lending and trading protocols like Aave, Uniswap, and MakerDAO during extreme market fluctuations over the years, they develop a strong willingness to participate, with the core demand being how to enter compliantly within the existing legal framework.

Especially after relevant digital asset compliance legislation in Europe and the U.S. has gradually clarified, the internal driving force of traditional institutions has fundamentally shifted. In recent years, most institutions have primarily conducted low-risk PoC validations through marginal "innovation labs"; however, in the past year, we have frequently seen CEOs or business line leaders of large institutions directly issuing clear instructions to technical teams: stop purely developing laboratory toys and start building real business closed loops on public chains.

David: Does this mean that the future evolution will first go through a transitional phase: on-chain, a batch of compliance institution sandbox networks protected by cryptography will be born, allowing financial institutions to operate their business logic in a controlled environment; as liquidity and infrastructure mature, compliant access to native DeFi protocols like Morpho and Uniswap will be achieved through cross-chain and zero-knowledge proof bridging technologies?

Oscar: This is precisely the clear path we are predicting and advancing. Many forward-looking large asset management institutions are deeply planning how to achieve composable integration of tokenized funds and on-chain lending protocols.

However, there exists a "cognitive and legal translation period" lasting several years in between. Many multinational banks have histories of over a hundred years, and their internal risk control manuals and legal compliance systems are entirely based on traditional central counterparty settlement systems. Accurately mapping these compliance frameworks to Ethereum's smart contract logic requires collaboration among technical experts, legal advisors, and policymakers. Those who understand more deeply and act more decisively among mature capital are currently racing to seize this historic transition period.

David: Let’s cast our gaze seven years into the future. Assuming by 2033, ETH Systems has achieved all its initially set strategic goals, and the on-chain migration of traditional institutions has fully erupted. In the most ambitious scenario you envision, what will the future on-chain financial system look like?

Mo: I believe that the top-tier technology should be completely "invisible" in its endgame form. Ordinary users should be able to enjoy the underlying security and free flow capabilities it provides without even being aware of the existence of blockchains, cryptographic algorithms, or decentralized ledgers.

Through decentralized identity (DID) and zero-knowledge proof systems, an ordinary investor can invest in high-quality global assets and achieve real-time settlement while fully controlling their sovereign data without having to submit sensitive privacy to centralized intermediaries. What we look forward to seeing is not just trillions of dollars of traditional assets being minted on Ethereum, but more importantly, allowing global assets to retain the permissionless composability advantages of DeFi while eliminating the data exposure risks for innocent individuals and businesses. In the next seven years, the migration of global mainstream financial infrastructure to decentralized public chains like Ethereum will become a certain reality.

David: This raises a very classic and sharp philosophical divergence: the core pillar that the crypto community has long been proud of is "data is completely public, verifiable across the network, and auditable on-chain." If in the future asset transfers, liquidity pool sizes (TVL), and institutional holdings are all hidden by zero-knowledge cryptography, how can the community ensure that the underlying system has not secretly over-issued or generated bad debts? How do we balance privacy protection with public trust?

Mo: Many industry observers easily equate privacy narrowly with complete unknowable data hiding. The precise definition of privacy in the context of modern cryptography is: under strictly controlled conditions, clearly defining who, at what time, and by what mathematical proof method can access which specific dimensions of information.

In real life, when you conduct a routine transfer at a bank, only you, the payee, and the account-holding bank know the transaction details; this business-level data isolation is the foundational order that ensures the normal operation of commercial society. The public's demand for complete transparency is essentially to gain certainty of trust that the system is not malicious. However, if modern cryptography allows us to provide verifiable proof of solvency to the entire network without exposing the counterparties and business secrets of individual transactions, this is clearly a more advanced and elegant paradigm of trust—selectively verifiable disclosure.

David: This is precisely the ideal state I hope for. The on-chain auditability we wish to retain includes macro-level total transaction volumes, aggregated fund pool sizes, total locked amounts across the network, and disorderly liquidation trigger lines.

When institutions deposit large private assets into lending protocols like Morpho, the system can still output the total asset volume verified by zero-knowledge proofs in real-time to the entire network; when large orders are traded on decentralized trading platforms, the public can confirm that the transactions have genuinely occurred and have been settled, but without exposing the specific institution's holding details and real-time strategies to front-running arbitrage bots (MEV).

On traditional mainnets, once top whales conduct large token exchanges, the entire network almost immediately engages in ruthless front-running and sniping, which is not a serious operational mechanism for a modern financial system. Institutions cannot bear having their entire trading footprints monitored endlessly. As long as we can verify the authenticity and compliance of the ledger through mathematical proof, we can fully balance transparency with commercial privacy.

Oscar: Absolutely correct; there is no irreconcilable contradiction between the two from a cryptographic perspective. With modern zero-knowledge proofs and homomorphic commitment schemes, we can elegantly design a layered system: keeping macro indicators related to public safety and system robustness globally transparent while providing impenetrable privacy protection for specific account entities, transaction details, and business strategies at the micro level. The Turing-complete programmability of Ethereum precisely provides the best soil for this architecture that balances optimal characteristics on both ends.

David: How should developers and core protocols within the ecosystem collaborate to accelerate this process? Whether it’s native DeFi blue chips like Morpho and Uniswap or researchers from the Ethereum Foundation, how can they better clear obstacles for institutional-level privacy?

Mo: For the broader DeFi ecosystem protocols, our call is very direct: if you are building innovative lending, trading, or asset management infrastructure, please feel free to reach out to ETH Systems. We are eager to explore with native teams how to adapt battle-tested DeFi protocols to institutional-level compliance privacy use cases.

At the same time, our team systematically open-sources the latest technical specifications and codebases every three to four weeks. Many executives and architects from international financial institutions are closely tracking these technical outputs. If the native community builds highly innovative privacy or scalability tools, we welcome direct submissions to our open-source codebase for joint evolution.

Oscar: Participants in the Ethereum ecosystem need to adopt a more open mindset to view our potential user base. We hope to encourage developers to not only focus on the experience of native retail users but also to deeply consider what kind of technical interfaces large entities constrained by compliance need. Breaking down the cognitive barriers between the Ethereum ecosystem and traditional institutions is a systemic project that requires long-term collaboration across the entire ecosystem.

Mo: Ultimately, our core mission can be summarized in one sentence: to be the translators and bridge builders between top-tier boards and cyberpunks. These two groups have often misunderstood or even opposed each other in the past, but we firmly believe that only by embedding decentralized technologies that truly safeguard individual rights and commercial freedom into the underlying system specifications of the highest decision-making levels can we truly reshape the future of global financial infrastructure.

David: This reminds me of an insight shared by Ethereum core researcher Danny Ryan. As a staunch believer in decentralization, when he sits down with architects from top Wall Street banks, although they use completely different professional vocabularies, their underlying demands are highly consistent: cyberpunks advocate for decentralization and anti-censorship, while traditional bank executives discuss how to eliminate single counterparty default risks. This is akin to the horseshoe theory, where the ultimate demands at both ends are fundamentally isomorphic at a deeper level.

Oscar: That is indeed the case. Whether individuals or institutions, the core attributes that everyone truly cares about at the underlying level remain highly consistent: security, anti-censorship, rule transparency, and privacy sovereignty.

The most fascinating aspect of Ethereum lies in its immense inclusivity: it can support completely decentralized, identity-free native crypto experiments while also building the next-generation financial system for trillion-dollar entities that balances privacy and compliance under strict legal and commercial constraints. Understanding this deeply, we will realize that these two aspects have never been disconnected.

David: Mo, Oscar, you are advancing a pioneering work that is crucial for the entire Web3 industry. Thank you for the profound insights you brought to Bankless, and I wish ETH Systems all the best in its journey to promote institutional on-chain migration in the future.

Oscar: Thank you very much for David's invitation.

Mo: Thank you, David. It's great to be here.