The Biggest Barrier to Wall Street Using Ethereum

Regulatory clarity, including the Genius Act, is associated with greater institutional interest in Ethereum, but adoption also depends on translating blockchain capabilities into the legal and compliance frameworks used by financial organizations. Institutions may select jurisdictions that provide the legal properties they require.

Ethereum's lack of default privacy is a central institutional barrier because organizations want public-chain liquidity and business opportunities without exposing account-level information or trading histories. Selective disclosure could preserve verifiable aggregate metrics such as trading volume, market capitalization, TVL, and AUM while restricting detailed account access.

Institutional privacy cannot be solved with a single standard design: requirements vary by business use case, legal constraints, throughput, and security needs, and privacy L2s or other tools may involve unacceptable trade-offs. The speakers describe the remaining challenge for these use cases as primarily an engineering problem rather than a fundamental research problem.

Moving systems that already handle billions of dollars onto Ethereum requires confidence in the full system's security, privacy, censorship resistance, and scalability. A nearly nationwide confidential-payments project illustrates the complexity, involving the sender, receiver, auditor, and government.

The speakers argue that institution-specific implementations and privacy built into Ethereum's core can advance together: ETH Systems converts business and legal requirements into technical work, then generalizes lessons from architecture reviews, proofs of concept, and production environments into open-source components. Open investigations and permissive licensing are presented as ways to build institutional trust.