Global wealth manager UBS and Ethereum infrastructure specialist Nethermind have completed two joint proofs of concept. These tests demonstrate that the public Ethereum network can meet the operational and regulatory standards required by heavily regulated financial institutions.
The collaboration shows how banks can introduce strong compliance controls through systems layered on top of Ethereum.
The approach avoids any changes to the core public protocol, preserving the network’s openness, neutrality, and broad compatibility with the wider ecosystem.
The two experiments focused on key moments when transactions are prepared and included on the blockchain.
In the first proof of concept, the teams configured an Ethereum node to enforce customizable compliance and risk rules.
These included limiting activity to pre-approved addresses only and blocking interactions with certain high-risk smart contracts.
The second proof of concept developed a routing component that directs bundles of already-approved transactions through specialized relay services directly to selected block builders.
This mechanism helps ensure reliable and consistent inclusion of compliant transactions on the chain.
Both tests ran successfully on Ethereum’s Sepolia test network in a controlled environment.
No live mainnet transactions or real assets were involved.
The results confirmed that only approved activity was processed and permanently recorded.
Overall, the work proves that a regulated bank can maintain full oversight of its own infrastructure layers.
Compliance checks can be applied both at the point of transaction submission and during propagation and final recording, all without altering Ethereum’s public and permissionless design.
Andreas Kubli, Group Head of Digital Assets at UBS, highlighted the value of the partnership.
He noted that the bank is building foundational systems for tokenized and digital assets with a client-focused and responsible mindset.
The proofs of concept validated a collaborative method for achieving institutional-grade controls while retaining Ethereum’s openness and interoperability.
Tomasz Kurowski, Head of Enterprise Business at Nethermind, emphasized the company’s focus on enterprise-grade Ethereum infrastructure.
He described the results as evidence that institutional requirements can be satisfied without compromising the network’s core principles of openness and broad compatibility.
He acknowledged UBS as a partner in this effort.UBS manages approximately $6.9 trillion in invested assets as of the first quarter of 2026 and operates in more than 50 markets worldwide.
Nethermind develops one of the main Ethereum execution clients and supports enterprises in deploying resilient, compliance-aware blockchain solutions.
The two organizations plan to expand on these findings as technology and regulatory conditions continue to evolve.
This type of targeted collaboration illustrates how innovations in public blockchain infrastructure can deliver practical benefits for risk management and regulatory adherence in the digital assets space. dreamstime.com These tests represent an important step in bridging traditional finance with decentralized public networks, potentially opening doors for wider institutional participation in Ethereum-based activities while upholding strict compliance standards.