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· One min read
Augusto Lara

We created a new crowdloan campaign to be open for 24 days to compete in auctions 40 and 41.

Terms are same as before, and contributors to the first crowdloan will receive a 20% bonus.

Please (re)contribute today. Many thanks from the Hashed Network community

· One min read
Max Gravitt

2023 Road Map Q1

- Phase 2 of Bitcoin Orchestration
- Attach multiple `xpubs` to a Substrate account
- Proof-of-reserves reporting
- 'Sign with Google' direct in browser

- Signer mobile app (Hancock) prototype, including porting the below libraries to Substrate:
- `substrate-signing-request`, or `ssr://`
- `anchor-link`
- `anchor-link-browser-transport`
- `buoy-server`
- `buoy-client`

- Initial release of the `fund-admin` and `marketplace` protocols
- Support the release of partner dapps (PRXY, Afloat)

- Phase 3 of Bitcoin Orchestration
- Visual spend policy builder for bitcoin orchestration
- Schnorr key aggregation
- UTXO spending policy and metadata sharing

- Hancock ALPHA

- Phase 4 of Bitcoin Orchestration
- Signature request push notifications

- Hancock BETA
- Add bitcoin signing
- Improve user onboarding and key backup/recovery

- Expand `fund-admin` protocol and `marketplace` protocols

Q4 and beyond
- Hancock v1 Release
- More abstracted components to be used as core business processes
- Accounting
- Supply Chain
- Invoicing

· 4 min read
Max Gravitt

Deloitte issued a report in 2017 on transferable state tax credits that stated:

Companies should analyze transferable credits as part of a holistic approach to managing their current and future tax liabilities balancing potential tax benefits against cash flow needs that could be addressed by selling transferable credits.

Navigating transferable credits can be complex.

Depending on the credit and the state, transferrable credits can either be sold in full to one taxpayer or can be divided up and sold to multiple taxpayers. State-by-state provisions also determine whether a credit can be resold or reassigned by the transferee to another taxpayer and, if so, how many times. In some instances, transferrable credits may also be used to offset more than one type of tax.

Afloat Tax Credit marketplace organizes the complexity into an easy to use platform for originating and transfering credits.

The Inflation Reduction Act (IRA) includes two critically important sections. Section 6417 describes a set of tax credits, and section 6418 describe the rules for transferrance.

The list of credits include:

  • Alternative fuel vehicle refueling property
  • Carbon oxide sequestration equipment
  • Zero-emission nuclear power production
  • Advanced manufacturing production
  • Clean fuel production credit

The Congressional Budget Office estimates the new tax credits will cost $260 billion over the next ten years.

Pomerleau compares the legislation to the:

Safe Harbor Leasing provision in the 1981 Economic Recovery Tax Act, which significantly accelerated depreciation deductions for new investments. In response to the concern that companies without taxable income couldn’t fully benefit from the larger depreciation deductions, the tax reform allowed companies to sell their depreciation deductions and investment tax credits to other companies for cash. The provision was designed to encourage economic growth and provide investment incentives for companies with no tax liability.

Earlier this year, the IRS published Request for Comments on Elective Payment of Applicable Credits and Transfer of Certain Credits. The Department of Treasury and IRS sought direct feedback on "what other processes could be implemented by the IRS to prevent duplication, fraud, improper payments, or excessive payments under § 6417?"

Afloat, already handling state tax credits for years, shared feedback as requested in a letter to IRS Associate Chief Counsel.

Buyer of Last Resort

There should always be a buyer of last resort for every tax credit because there is an enormous supply of buyers.

If, while someone is filing their taxes online, they are presented with an offer that allows them pay less in tax by clicking a button, they will click every time. The absence of such a button is evidence of the high transactional and redemptive friction in the transferance of credits. Afloat eliminates that friction, and scales its participants and marketplace with Moderated Marketplaces on Hashed Network.

Growing Total Addressible Market

Adding an additional $280 billion to the TAM in 2023. Long used at the state level, the IRA's clear embrace signals legislators want to incentivize outcomes, such as green energy technology, using transferable tax credits.

What does this mean for Hashed Network?

The Marketplace protocol applies a burn of HASH based on the amount of the tax credit sold. If Afloat captures just 1% of this incremental $280 billion market, it would burn $5.6 million of HASH in the process.

For the detailed mechanics and to plan your business, see the HASH Burn Calculator.

· 4 min read
Max Gravitt
Augusto Lara

What is Fireblocks?

"Fireblocks is an easy to use platform to create new blockchain based products, and manage day-to-day digital asset operations." --

The Fireblocks platform has a large presence and the general use case so similar, it serves as a helpful comparison when explaining Hashed Network's bitcoin orchestration and Native Bitcoin Vaults.

Fireblocks is a commercial, closed-source platform for handling multisignature transactions, generating receiving addresses through a verified business network, and interfacing to Defi applications. It allows organizations' administrators to add and manage users and configure corresponding spending permissions. See more about their policy engine.

There is a corresponding mobile application for approving transactions. This app receives push notifications when a spend requires a user's approval, and then they are able to approve directly in the app.

The platform supports an Integrations network that provides a wide breadth of compatibility and access to other service providers, including accounting/tax experts, AML partners, FIAT ramps, etc.

A secure oracle application can run on an Intel SGX server and sign programmatically based on custom criteria.

Multiparty Computation (MPC) as the secret sauce

Multiparty computation is an off-chain cryptographic algorithm that allows m-of-n key shares to be combined to produce the private key required for the transaction. The independent nature of the algorithm means that it is compatible with any secret and thus any blockchain.

MPC does not expose signers on chain, but the data is persisted within the Fireblocks systems.

How secure is Fireblocks?

This is unknown because the platform is closed-source.

Hashed Network Bitcoin Orchestration

Bitcoin orchestration is a protocol hosted on the Hashed Network that performs all of the non-signing functions to safely and securely:

  • generate receiving addresses,
  • build and route partially-signed bitcoin transactions (PSBTs) to the correct signers, and
  • manage UTXOs via coin control, labels, and tags.

Native Bitcoin Vaults uses bitcoin orchestration to release a user-facing application for business users, treasurers, and fund administrators.

Key Similarities

Direct and Self Custody

Both Fireblocks and Hashed Network encourage direct custody or self custody. Many businesses use centralized exchanges to custody their digital assets, meaning that they are dependent on that custodian for safety and withdrawals.

Multisignature and Governance

Both platforms support the ability for administrators to configure business rules for spending and handling assets.

Verified Network of Businesses

Both platforms support a network of businesses with verified identities. Although the digital assets flow peer-to-peer on the native networks, verified profiles and dynamic address generation make remittance more secure and frictionless.

Key Differences

Administrator Centralization

As a commercial application, each of Fireblocks customers have a singular administrator account. This is the account that has ultimate control over the activities of users under that administrator's purview.

Hashed Network can be used with decentralized groups without a single administrator.

Asset Focus

Fireblocks supports over 40 protocols and what seems to be thousands of tokens.

Hashed Network is focused primarily on bitcoin, but also supports limited USD stablecoins and DOT-native assets.


Fireblocks uses closed source multiparty computation orchestrated via a closed source platform. MPC transactions cannot be executed with cold wallets.

Hashed Network uses BIP 174, and the taproot upgrade, BIP 340, BIP 341, and BIP 342. These are Bitcoin Core protocols, and thus signing has wide support in variety of hot and cold signers. Substrate signing is separate from Bitcoin signing (although we will be integrating them into our app in 2023).


Fireblocks is closed source so much is unknown.

Hashed Network is a Substrate blockchain (and prospective Polkadot parachain). Accounts attest to extended public key(s) on Hashed Network, which can be used to generate many vaults. The pallets are used to manage the spending policies, share relevant data with confidential documents, assign/generate receiving addresses, and more. They use the rust BitcoinDevKit library for Bitcoin cryptography and script generation, and off-chain workers to interact with the Bitcoin network.

Hashed Network does not use any wrapped-tokens, collateral-backed assets, paper bitcoin, or bridges. All of the Bitcoin transactions occur directly on the Bitcoin network for true self-custody.

Side by Side Comparison Table

FireblocksHashed Network
CryptographyMultiparty Computation (MPC)Bitcoin Core BIP 174, and the taproot upgrade, BIP 340, BIP 341, and BIP 342
Asset Types44 protocols and thousands of tokensBitcoin, selected USD stablecoins, and DOT-native
User-facing AppsWeb app and mobile app for 2FA approvalsWeb app and mobile app signer
Compatible SignersOnly Fireblocks appsAny Bitcoin signer, including hardware and air-gapped signers
Verifiable Receiving AddressesNoYes
Central Admin RequiredYesNo
LicensePropreitary/ClosedMIT, Open-Source

· 6 min read
Connor Irish
Max Gravitt

What is Fund Administration?

Fund administration is a common third-party management function for special purpose vehicles (SPVs) or what many refer to simply as “Funds”. An SPV or a Fund, in basic terms, is an entity designed with the purpose of accepting capital from investors and then using those funds for a specified purpose or enterprise. Common examples include private equity funds, real estate funds, venture capital funds etc.

Here are two simple examples:

  1. A real estate developer forms a real estate fund called RE Fund X to accept capital from outside investors and then deploy that capital into a 500 unit hotel project. Once all of the capital is raised, that capital is being held be RE Fund X. The developer then needs to access the capital to pay for the hotel project – i.e. paying contractors, paying for materials, architects, attorneys etc. The fund administrator’s job is to ensure those funds are being properly allocated, released and spent correctly on the subject hotel project.

  2. A venture capital group forms a venture capital fund called VC Fund X. Similar to the above, VC Fund X accepts capital from investors, but, this time the purpose of VC Fund X is to invest in early stage technology companies. Here, the fund administrator may be in charge of ensuring the capital is properly allocated, released and spent on qualifying early-stage companies within VC Fund X’s target class.

Fund administrators serve as a third-party source of integrity while they often also handle much of a Fund’s back-office such as accounting, limited-partner reporting, capital tracking, and capital distributions.

What is PRXY and EB5 Proxy?

PRXY is a software provider that owns and operates the EB5 Proxy platform, purpose-built for EB5 fund administrators, with support for:

  • recording inbound investments,
  • tracking budget to actual for projects,
  • submission of funding requests (“drawdowns”),
  • allows fund administrators to review, approve, and transmit funds,
  • calculates jobs created by the expenditure of EB5 capital, an important metric in the process.

Now is a critical time for the EB5 fund administration due to the recent passage of the EB5 Reform and Integrity Act of 2022. This legislation mandates that EB5 funds have an independent, third-party fund administrator with the goal of adding additional integrity measures and boosting investor confidence in the EB5 industry.

EB5 Proxy is leading the way to capture the market and is the only option that is backed by the security of blockchain.

What is an example of an EB5 Proxy Project?

The 11th Ave Marriott Hotel in midtown Manhattan uses EB5 Proxy software to manage drawdown requests from the builder for items such as concrete, environmental studies, and furniture. The requester uses Confidential Documents (CD) to encrypt and upload files/data to a drawdown request, and that transaction also shares the data.

Tech Note: The CD share transaction encrypts the data to the recipients’ key(s). CD also supports group-based sharing, and in the case of a drawdown, it is shared with the “fund-admin” and “bank/lender” groups.


Augusto Lara, Hashed Systems DAO LLC Co-founder, posing with the under construction 11th Ave Marriott Hotel in the background

What is the role of the blockchain in the application?

Hashed Network features fund administration primitives that secure the process of shared funds, with support for integrating payment systems that may or may not use a blockchain.

These primitives integrate with Hashed Network pallets such as bitcoin vaults and role-based access control. The Network also integrates with Wyoming Special Purpose Depository Institutions (SPDI). SPDIs "conduct activity under Wyoming regulations tailored to digital assets, which address issues such as technology controls, transaction handling, and custody operations for digital assets."

EB5 Proxy users receive significant value even without final settlement occuring with digital assets. A payee can submit a drawdown request with appropriate backup info; the banker role reviews and processes the payment using any method, and then attest that it was completed in the app. Users love how the single-source of information for a project is in "one place" and how much time they save.

Another inherent benefit to the platform is proof-of-existence guarantees for documentation.

What type of documentation and process are secured on-chain?

Fund administration requires careful tracking of fund sources and uses. For example, see the charts below for sources and uses are developed as part of project initiation.

The line items listed as EB-5 Loans are funds that require careful administration, and thus the overall project.


The total amount of funds sources is $504 M. Shown below is the Use of Funds, and the total amount is of course the same as the sources.


Even though final settlement of these funds are not yet being executed on-chain, the overall economic process valued at $504 M is secured by the chain. Additional projects valued at ~ $600 M, for a total of $1.1 B, are in queue.

Why Hashed Network on Polkadot?

Hashed Network use Polkadot to secure the immutability and functionality of the blockchain. Polkadot is a large and fast growing ecosystem. In terms of community of developers, it is the fastest growing and second largest blockchain ecosystem. Among its strengths, Polkadot specializes on how various blockchain ecosystems interface among each other, improving compatibility and reach while maintaining flexibility for an unpredictable future.

Hashed Network hosts the pallets and functionality used by the platform.

How is it secure?

In addition to the security of Hashed Network and Polkadot for data and functionality, data is end-to-end encrypted, with support for sharing with specific accounts or groups. All encryption source code is open source and available for review on Github.

The encrypted data is saved to InterPlanetary File System (IPFS), a flexible, stable, and widely used decentralized storage layer. Users and applications can subscribe to their storage feeds in the app or with a server.

What is on the road map for Fund Administration?

· 3 min read
Abigail Olson

Afloat, Inc., a marketplace for transferable tax credits, has completed the first milestone in an approved Web3 Foundation grant and the first step in migrating to Polkadot.

Web3 Foundation funds research and development teams building the technology stack of the decentralized web. It was established in Zug, Switzerland by Ethereum co-founder and former CTO Gavin Wood. Polkadot is the Foundation's flagship project. 

Louise W. Reed, founder and CEO of Afloat, values Polkadot’s network, stating, “Instead of Afloat operating in a competitive environment in isolation, we are excited to join the cooperative, global ecosystem of technology infrastructure and talent that Polkadot brings to the table.”

In Afloat’s case, a set of tax credits for sale from a seller is considered one NFT to be divided as buyers determine the amount they will purchase. In this milestone, Afloat’s backend team grouped the data of each fractionalizable NFT, called “fruniques,” into three different levels of public access: Public Header Data, Public Large Data, and Private Data. 

While any company or marketplace can benefit from fruniques and its accompanying layers of privacy, Afloat’s “Public Header Data” includes type of tax credit, expiration date, state, and amount. “Public Large Data” references public documents about the tax credit, and “Private Data” contains personal information, certificates of authenticity, and any other private supporting documentation. In the next milestone, this technology will be completed on the frontend and will be accessible to users on Afloat’s website.

This open source blockchain solution, accessible through GitHub, will not only help Afloat but also other companies coming in behind them and onboarding their own marketplaces. Currently, the functionality runs on Hashed Network, a Polkadot parachain candidate. If it were to become connected later this year, it would inherit the full security of the Polkadot relay chain. In the future, companies will be able to operate their own node to earn tokens and to make the blockchain more reliable for their users.

Thomas Howell, Afloat’s head programmer, comments, “We are extremely excited to join the Polkadot community and to leverage the increased transparency and security of the Polkadot platform to give our users an even better experience.”

The parallel chains of the Polkadot ecosystem are a stronger infrastructure for doing business than the initial single blockchain model of bitcoin and Ethereum, and the security of Polkadot’s blockchain solution will allow Afloat to integrate into the community with a public parachain instead of a private one.

Marketplaces represent a significant portion of blockchain use cases, and Afloat supports user-marketplace applications that a marketplace administrator can approve or reject. Open source, compliant, and confidential gated marketplaces lower the barrier for marketplaces to join the Polkadot ecosystem. 

The founder of Hashed Systems DAO LLC, Max Gravitt, explains his excitement, saying, "Hashed Network is launching on Polkadot because the powerful Substrate framework provides us the most flexibility to deliver on the needs of users and partners. The composable design allows us to build solutions without sacrificing security, performance, or usability. This, along with Parity's proven technical leadership, is why it is the fastest growing web3 developer community. We're just getting started."

· 5 min read
Max Gravitt

Onboarding onto Polkadot is hard and there are several areas of friction that users run into. This article identifies three of them and explains the solution that Hashed Network uses to address them.

I did not develop these core protocols, but we have built many dapps with them on other blockchains with technical and user success. I seek feedback on the technical architecture to ensure there are no foundational flaws, any reasons why it wouldn't work with Polkadot, or advice and support on implementation.

The Native Token Problem


Like Ethereum, you need the L1 token to do anything on Polkadot. However, in general, users don't begin their journey with the idea of having DOT and trying to find something to do with it. They start with a problem or application (dapp) and have a desire to use it, and then realize there is another step of having to buy DOT, which creates another separate thread of painful friction.


The Network's solution is to create Sybil-attack resistant methods for a faucet, such as verify SMS. SMS verification allows for a free initial faucet amount. It privately keeps a list of number hashes to avoid mis-use and also shields against VoIP SMS. Other methods could be verifying through a social network site such as Twitter or Github, which typically have their own Sybil protection.

Whitelisted oracles/origins that are allowed to use the initial faucet are voted in via chain governance, and those origins are allowed to use the extrinsic for new account creation and initial faucet. These oracles/origins, such as wallets or applications, will need to provide evidence to voters that they have Sybil protection in place.

Allowance for these users will be allocated at genesis and balanced via governance.


The Install-something Problem


A larger-than-you-think number of users reach the point of wanting to use web3 and then turn away when they are asked to install a new app on mobile or a browser extension. That is too much friction for a large segment of users, the so-called web3 curious or experimenters.


Don't require the user to install anything. Hashed Network supports "Login with Google", which uses the Google Drive API to save the user's key, access it, and sign and broadcast directly in the browser.

Is it great security? No, because Google has access to the key. It is a compromise. As the user gets hooked, there are easy migration paths to improved self-custody with an installed signer.

Signing Ergonomics Problem - Part 1


The desktop-to-mobile signing experience lacks continuity. Parity Signer is a fantastic air-gapped wallet, but offline wallets are not practical for day-to-day usability. Some of the other wallets require that users go into the application browser, select from a list of applications or enter an address.


The more natural flow for users is to access an application via a link that opens in their default web browser. As the user navigates to Login and sign transactions, they are prompted to do so.

Signing Ergonomics Problem - Part 2


The related continuity problem is using the same account on both desktop and mobile requires moving the key.


Keep the key on the device only. When the mobile browser needs a signature, it sends a deep link (similar to a mailto: link) to the operating system to open a signer app. The transaction signature request is sent to the signer where the user approves and the application broadcasts it.

When a user access an application on desktop, they are prompted to login by scanning a QR code. The user opens their device and scans the QR code using the default camera app. The user taps the QR code, scans a login payload, and broadcasts the signature back to the browser over the network (not via webcam like Parity Signer).

This step connects the browser and device for the duration of a configurable session, which can be managed on the device. When the user performs an action in the application that requires a transaction signature, it is sent to the device over the network as a push notification. The payload is signed, signature is passed back to the application, where it is broadcast.

This feature requires a small intermediate relay, which we are investigating building directly into the Substrate node.

Action Plan

Part 1 above is made possible by a signing request protocol that can be encoded in the application and decoded by the signer.

- Should we add support for Substrate transactions? 

Part 2 above is made possible by a signature provider protocol that is an open standard with support end-to-end encryption, persistent account sessions, and identity proofs.

- Should we add support for Substrate transactions?

· 5 min read
Max Gravitt


There are 3 key features of Native Bitcoin Vaults.

  1. Flexible policy engine for managing bitcoin with business rules
    • Uses Partially-Signed Bitcoin Transactions (PSBTs) to roll-up bitcoin spending proposals and approvals
    • Orchestrated by Substrate, integrated with bitcoin via off-chain workers
    • Bitcoin signing compatible with many convenient signers, from highly secured airgapped signers to not-very-secure 'Sign with Google' for the web3 experimenter.
  2. Verifiable receiving addresses
    • Bitcoin senders can independently verify a receiving address for a specific vault, such as an elected council based on the democracy pallet.
    • Generate a new receiving address for each UTXO
  3. Integration with other Hashed Network features
    • Triple entry accounting platform allows businesses to natively assign bitcoin sends and receipts to General Ledger accounts such as Income and Expenses.
    • Integration with Confidential Documents, which allows users to securely encrypt, save, and share data that corresponds to a vault or journal entries.

There are 3 key 'reasons to believe' NBV is useful.

  1. More businesses are adopting bitcoin on their balance sheet.
  2. NBV is real, simple, pure bitcoin. That's what people want.
  3. The market for approval and payment tools is robust.



Flexible Policy Engine

Bitcoin is a UTXO-based blockchain (as opposed to account-based, like Polkadot), and in the early days, we would send bitcoin to the same address over and over again. However, it is more privacy-preserving to generate a new receiving address for every transaction, which has become the norm now. Each receiving address is transformed into a UTXO as soon as it receives a payment.

Each UTXO has a pre-determined, Substrate-orchestrated configuration for set of potential signers and threshold. This creates a lot of flexibility for use cases such as budgeting funds to sub-groups or task forces, paying invoices based on requested drawdowns, and using higher security signers for larger UTXOs.

To spend the UTXO, Substrate compiles the Paritally Signed Bitcoin Transactions (PSBTs) together, and when ready, broadcasts it to the Bitcoin network. PSBTs were introduced in BIP-174 and are implemented in many wallets including Bitcoin Core. NBV also uses output descriptors extensively, which is also a broadly supported standard for describing UTXOs in a composable fashion.

Using standards like these means that there are many available signers, such as ColdCard, BlueWallet, or libraries such as Bitcoin Dev Kit. Users can also sign with a key stored in Confidential Documents (sign via polkadot.js), our own Hashed Wallet, or even 'Sign with Google' for the web3 experimenter or casual user.

Verifiable Receiving Addresses

There are two primary attacks as it relates to bitcoin. Either a hacker finds your secret, or the sender is tricked into sending bitcoin to an address for which the hacker has the secret. NBV addresses the latter.

The generated receiving addresses can be cryptographically verified by senders from other vaults or senders using any compatible bitcoin wallet. For example, if a set of treasurers were elected using the democracy pallet, they could begin receiving contributions immediately and seamlessly rather than the worrisome trouble of having them coordinate together separately to generate receiving addresses.

Integration with Hashed Network Features

Verifiability is secure. However, some bitcoin vaults wish to remain private. NBV supports integration with Confidential Documents, which allows users to safely encrypt and share data such as the output descriptors, wallet metadata, receiving addresses, and vault documents.

NBV also integrates with the triple-entry accounting tools on Hashed Network. This platform allows businesses to natively assign bitcoin sends and receipts to General Ledger accounts such as Assets and Expenses, enabling Income Statements and Balance Sheets.

Reasons to believe

Most bitcoin layers that I've seen on programmable blockchains, such as Ethereum and Polkadot, have an element of custody/trust, peg tokens, or collateral backing. They are usually engineered by people much smarter than me, and I'm not qualified to opine on how secure they are.

I think people want real bitcoin though. Real, simple, pure bitcoin. Especially for large amounts often seen in business treasuries or managed by governance teams.

In 2021, companies such as Tesla and Microstrategy adopted bitcoin as a treasury asset, many of which described in this Cointelegraph article. We believe this trend will continue and accelerate in the coming years.

Valuations for companies such as Fireblocks, which raised $550 million on a valuation of $8 billion, suggest that there is a market for payment approval, coordination, and broadcast.

Road Map

There are 3 key focus areas on the road map:

  1. Short term focus is usability for basic treasury activities
  2. Migrate from off-chain worker BDK-integration to WASM
  3. Integrate additional signers