Provenance Blockchain is a distributed, proof-of-stake blockchain designed for financial service industries.It reduces third-party intermediation and internal staffing costs, promotes greater transparency and liquidity, and allows for new kinds of financial engineering and business opportunities. Any firm using Provenance Blockchain benefits from the blockchain and only pays Hash gas fee payments back to the ecosystem.
Provenance Blockchain has three key attributes: Distributed Information, Immutable History, and Trustless Data. Distributed content provides defense against hacking, eliminates agency problems that can lead to malfeasance, and helps support enforceable digital contracts. Data written on the ledger cannot be changed. Immutable information is critical in establishing asset Provenance Blockchain and the truth of the data. Having to rep and warranty data — analogous to “trust me” — undermines the system and introduces risk to those who provide these attestations.
Provenance Blockchain performs three key functions: ledger, registry and exchange.
Ledger — Movements of value are done on blockchain, delivering true economies of scale. Immutable records reduce or eliminate the need for trustees and reconciliation and provide real time visibility to information.
Registry — Ownership is determined solely on blockchain, allowing T+0 pledging and sales of assets. Chain of custody is immutable, and recording and conveyance are the same thing, eliminating latency/discrepancies.
Exchange — Price discovery becomes transparent, eliminating the need for market making intermediaries. Assets can be tokenized, allowing fractionalized sales and creating liquidity in illiquid asset classes.
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Figure Equity Solutions — Cap table management leveraging immutable records and instant traceability
Figure Marketplace — Bilateral trading of digital assets, including loans, loan participation, and private equity
Figure Loan Origination System
Figure Pay — Payments using blockchain rails
Figure Passport — Digital Identity on-chain for entities and individuals
Figure Portfolio Manager — Manage and see the real-time performance of loans on Provenance Blockchain
The blockchain space has rapidly evolved in the two years since the launch of the Provenance Blockchain 1.0 blockchain. Industry wide there is an increasing focus on proof-of-stake networks and the use of rollups, peg zones, and similar methods for integrating different blockchains. Major public networks centered around Ethereum are seeing increasing interest and load as more financial applications are developed in the Distributed Financial (DeFi) space.
Based on the lessons learned running Provenance Blockchain 1.0, an updated Provenance Blockchain version is expected to provide enhancements in the following key areas:
- Streamline Operations
- Decentralized Digital Identity
- Focus on Networking between Blockchains
- Capacity for Growth
- Encourage Use Case Growth
- The Provenance Blockchain Balance Point
More details about Provenance Blockchain 1.0 and Provenance Blockchain 2.0 can be checked here.
What is the Provenance Blockchain Foundation?
The Provenance Blockchain Foundation (PBF) is a non-profit organization dedicated to supporting the development of DeFi applications that leverage the Provenance Blockchain ecosystem.
The Provenance Blockchain Foundation supports and sponsors the development, maintenance and operations of a set of custom modules and infrastructure services to help with the creation of distributed applications that streamline management of financial instruments and transactions. Those modules are integrated within the Provenance Blockchain ecosystem and may therefore be readily adopted, integrated, and productized by clients.
The PBF supports and funds a grants program for Provenance Blockchain Improvement Projects (PIP). This program is used to improve and enhance the ecosystem components and services, and to provide education for and outreach to the community and beyond about the why’s and how-to’s of leveraging the Provenance Blockchain network, its services, and its SDK.
The PBF does not own the Provenance Blockchain network nor any of its applications. Its mission is to bring a community together with the common purpose of creating, supporting and leveraging the best of breed DeFi ecosystem. The only reason for the community to stay together under the umbrella of the PBF, is when the benefits of the ecosystem for the community members and the ROI for the members of investing in that ecosystem, are clear and worthwhile — the PBF must work to ensure those conditions are met. Note that although the PBF will own the Github accounts where the code of the infrastructure components is maintained, the Apache 2.0 license allows anyone to freely fork the effort and use the code anyway they see fit elsewhere.
Provenance Blockchain Foundation Mission
Provenance Blockchain’s mandate is to provide the world’s best ecosystem for developing and deploying DeFi applications. We believe a community-driven, open-source model based on the best-in-class, eco-friendly Cosmos/Tendermint internet of blockchains is essential for the success and wide adoption of the next generation of decentralized financial applications.
The Foundation is seeded with a generous fund to support the foundation’s operation, the core infrastructure, and a grants program for Improvement Projects (PIPs). Ongoing funding is provided by levying fees (gas) on the use of the Provenance Blockchain network services. The Provenance Blockchain native utility-token to pay for services is Hash, which can be freely bought and sold on publicly traded exchanges.
The Provenance Blockchain Utility-Token: Hash
Smart-contract and Validator services on the Provenance Blockchain network are paid for in Hash. 2% of that gas fee is levied to support the Provenance Blockchain foundation.
The Provenance Blockchain Core Infra Funding
The core infrastructure services, code and operations have guaranteed funding to ensure a high level of integrity and service-level of the Provenance Blockchain ecosystem operation. The foundation works off an annual budget for core infrastructure support, and uses commercial contracts to pay entities for the associated work.
The Provenance Blockchain Grants Program
The grants program funds Provenance Blockchain Improvement Proposals (PIPs) that are chosen by the members through voting. Anyone can propose a project for work that can benefit the community and/or enhance the ecosystem. If the foundation members vote favorably on a proposal, the submitters will be funded for the associated work.
Provenance Blockchain 2.0 strikes a careful balance between many different criteria among the varied approaches of blockchain software. Unlike many blockchains that are focused solely on payments, the Provenance Blockchain network is built around digital assets. This distinction shifts the system design firmly towards general purpose designs versus those that are highly optimized for small transactions. The following criteria are carefully considered when evaluating the adoption of or migration to any current or future blockchain software:
- On complex, dedicated infrastructure with explicit configuration requirements versus flexible, ad hoc connectivity: Provenance Blockchain prefers a flexible approach. One of the important lessons learned from the first generation of the Provenance Blockchain network is that even though operational aspects of a network can be optimized and streamlined through the use of automation tools, they still have a real non-trivial impact on the overall maintainability and cost to run the network. A complex, explicit networking configuration also tends to be brittle in response to failure when compared to a dynamic peer-to-peer configuration. For the second generation of the network, Provenance Blockchain is focused on lowering these barriers to run the network as this increases adoption and improves the overall cost effectiveness of the system.
- On specialized structure versus general purpose approaches: Provenance Blockchain heavily favors a general purpose approach. The ability for developers to implement features rapidly in environments they are comfortable with has been an important factor in the current success of the Provenance Blockchain both for migrating business processes to the blockchain as well as refreshing the blockchain as the platform evolves. While specialized approaches including custom domain specific languages (DSLs), restrictive APIs or execution environments, exotic languages, and more may be selected for certain specific benefits, each of these techniques have extensive external costs that can negate any perceived benefits.
- On methods of integration and extensions of a blockchain node: Provenance Blockchain prefers flexible platforms that support multiple types of composable extension over those that require all functionality to be implemented through a single interface. A flexible extension model allows appropriate components to be selected to extend the core of the blockchain and extend or replace any other component that does not match the requirements. This same idea extends to governance decisions where not all types of extension and modification have the same level of impact. A flexible platform can adapt and respond to the needs of the application and is not forced to match a more generic general case.
- On distributed control and ownership of a network versus centralized models: Provenance Blockchain favors a sovereign approach where individual networks are left to choose the approaches to governance and interoperability that match their specific needs. The Provenance Blockchain network has always maintained a strong focus on the requirements and concerns specific to the financial use cases it supports. This focus is shared by stakeholders that participate in the network. The considerations and views of the Provenance Blockchain stakeholders are not expected to perfectly match up with those of other blockchain networks, even those Provenance Blockchain chooses to partner with directly. Provenance Blockchain prefers approaches to federation of blockchains where explicit connections between networks are curated according to the requirements of the partnership and not dictated by the overall ecosystem.
- On support for non-custodial identities: Provenance Blockchain prefers that clients maintain the ability to “bring their own keys” to the blockchain without requiring centralized control or approval. Approaches that rely on certificates issued by a certificate authority or global governance board to control access are incompatible with the intended direction of Provenance Blockchain towards a decentralized public network.
Smart Contracts (ProvWasm)
ProvWasm contains extensions for a third party blockchain module. These extensions, combined with a library, provide developers the ability to create web assembly smart contracts for the Provenance Blockchain using the Rust programming language.
Parameters –The core of the rust library contains types that are passed to and received from Provenance Blockchain encoders and queries. Special care must be taken to ensure the Rust types are compatible with Go types in the queries and encoders. To support this, a semantic data format version is passed through with each message. This enables backward compatibility in the blockchain extensions.
API-A number of high-level functions and types were added on top of the core parameters to simplify contract development. This will also provide a compatibility layer — minimizing changes required to smart contracts when breaking changes are required in the blockchain extensions and core types.
Mocks-One of the benefits of ProvWasm is that it allows for robust unit testing of smart contracts before deployment to the Provenance Blockchain. Using the types described above, a mock environment can be created so unit tests can run as if they are executing against a running blockchain. This allows developers to ensure their contracts are correct before having to pay fees to deploy to a network.
Integrations-To ensure the library code works correctly with the blockchain extensions, smart contracts were developed for each custom module in provenance. These contracts can be deployed to a localnet (or the testnet) for integration testing.
Proposals are initiatives put to vote by stakeholders to perform actions using a consensus of votes. This process is called governance. The proposals themselves may be simple statements (text proposals) or initiatives to change configuration parameters (configuration change proposals), software upgrades, and more. Voting is the process of assigning active stake to one of the four different states for a proposal [yes, no, abstain, veto]. Only actively staked hash can be used for a vote. Each actively staked Hash corresponds to one vote. The governance voting process is broken down into three stages; Deposit, Voting, and Tallying results. Proposals must clear the deposit stage before they can proceed to voting and finally have their results tallied.
Anyone can submit a proposal to the Provenance network for stakeholders to review. In order for the proposal to proceed to a vote it must meet the minimum required deposit. The minimum deposit required is 1,000 HASH. A proposal has up to 48 hours to collect enough deposits to become eligible for voting. A proposal will immediately proceed to voting when the threshold is met. If the proposal does not achieve quorum or the proposal is vetoed the deposits are forfeit.
The voting period for a governance proposal is fixed at 48 hours. During this time delegators and validators may place their votes of Yes, No, Abstain, or No with Veto. When a validator votes the total of their delegations is applied as weight to their choice. Their individual delegators can accept the vote of the validator they have staked against or explicitly vote their intention which will take precedence over the validator’s vote.
At the end of the voting period the cast votes are tallied according to the following thresholds to determine if a proposal passes or not.
Quorum: At least 33.3% of the active state in the network must vote on a proposal for the vote to be considered valid. If quorum is not reached the proposal fails
Threshold: Of the votes cast, at least 50% must be Yes votes for the proposal to pass
No with Veto: If more than 33.3% of the votes are cast as a No with Veto the measure fails regardless of if over 50% of the votes wereYes. This last option allows a minority stakeholder to prevent a measure from passing even if the majority endorses it.
If the majority of a proposal vote exceeds quorum and is not vetoed then the proposal is passed at the end of the voting period. For certain proposals such as software upgrades their effects are applied at this time.
Software Upgrade Proposals
Software upgrade proposals will occur when major upgrades are required on the Provenance Blockchain network. When this does occur a governance proposal will be made to request all validators vote on the new software upgrade. All software upgrades will be sourced from the provenance-io/provenance repository.
Submit a software upgrade proposal
Once a new release for the Provenance Blockchain binary has been created, a software upgrade proposal can be run. The proposal should have a name, title, a description of the changes, a url of the plan with the necessary binaries, upgrade block height, required deposit, and chain-id.
Provenance Blockchain uses HASH as both a utility token and governance engine. HASH is fixed in float — it can’t be created or destroyed. Fees on Provenance include gas fees, community fees and smart contract fees, enabling smart contract developers to assess fees commensurate with the value created by using blockchain versus traditional execution. Fees are quoted in fiat, but always paid in HASH. The Provenance Blockchain Foundation serves the HASH holders by growing adoption by financial institutions as well the developer ecosystem and is responsible for setting and distributing the community fees. Gas + community fees target 1/3 of the economic value created by using the blockchain. Smart contract owners are guided to charge an equivalent amount for use of the smart contract. The value of HASH is the present value of fees paid into the blockchain. Given the size of financial services, modest market capture results in billions of dollars of fees — and corresponding HASH market capitalization. Payments, exchanges and lending each represent trillions of dollars of fee opportunity.
Functions: Provenance Blockchain uses HASH as both a utility token and governance engine. HASH is fixed in float — it can’t be created or destroyed. Fees on Provenance include gas fees, community fees and smart contract fees, enabling smart contract developers to assess fees commensurate with the value created by using blockchain versus traditional execution. Fees are quoted in fiat, but always paid in HASH. The Provenance Blockchain Foundation serves the HASH holders by growing adoption by financial institutions as well the developer ecosystem and is responsible for setting and distributing the community fees. Gas + community fees target 1/3 of the economic value created by using the blockchain. Smart contract owners are guided to charge an equivalent amount for use of the smart contract. The value of HASH is the present value of fees paid into the blockchain. Given the size of financial services, modest market capture results in billions of dollars of fees — and corresponding HASH market capitalization. Payments, exchanges and lending each represent trillions of dollars of fee opportunity.
The USDF Consortium is a membership-based association of FDIC-insured banks. The mission to build a network of banks to further the adoption and interoperability of a bank-minted tokenized deposit (USDF™), which will facilitate the compliant transfer of value on the Provenance Blockchain, removing friction in the financial system and unlocking the financial opportunities that blockchain and digital transactions can provide to a greater network of users.
USDF Consortium is making the market safer, cheaper and more reliable for consumers who want to transact on blockchain by ensuring banks continue to play an important role in the financial ecosystem as blockchain adoption accelerates. We are committed to building the foundation and advancing responsible innovation that will allow banks to harness the benefits of this transformative technology.
More information about HASH and USDF can be found here.
Participants are individuals/entities that transact on Provenance Blockchain to register, custody and trade assets. Any participant can become a Validator or Delegators. Participants pay transaction fees when executing transactions on Provenance Blockchain. In addition the Client Execution Environment can assist in facilitating private conversations and processes between participants that are hashed prior to being included in the immutable record held by validators. By the way, Provenance Blockchain has a group of leading financial institutions participating across functions, including:
Participants who put assets on Provenance Blockchain. Asset originators (e.g. loans), funds (investments).
Participants who purchase/finance assets on Provenance Blockchain. Banks and funds.
Participants who securitize assets, and investors who purchase the bonds on Provenance Blockchain.
Validators/Delegators. Buy-side, sell-side firms, other financial services companies and 3rd party validators who independently host the blockchain.
Omnibus Banks who provide a bridge between fiat and Provenance Blockchain.
Validators perform the critical function of proposing and validating transactions on the Provenance Blockchain network. A strong network of validators ensures Provenance Blockchain security is maintained. Validators stake Hash to become part of the active validators on the network and are a foundational element for Hash holders that want to delegate their stake and share in rewards produced by the network’s fee distribution framework.
Hosting a Provenance Blockchain validator has some requirements since stakeholders will likely not want to delegate their stake to a validator that isn’t reliable and secure. Here are some guidelines to consider when determining whether hosting a validator is beneficial for your use case:
Reliable, highly available, and secure computing infrastructure with excellent network connectivity.
Minimum Self-Delegation (Hash) — To host a validator you have to ensure you have the minimum amount of Hash to delegate.
Minimum level of staking delegation — the top 50 validator nodes within the network by total stake are selected as the active set of validators.
Commitment to maintaining a current release of the blockchain software and performing software upgrades as required.
Commitment to vote on governance proposals.
To know more Responsibilities in Hosting a Validator please check here.
To understand delegation it’s important to understand the difference between Hash ownership and Hash staked on the Provenance Blockchain network.
Hash — Utility token used by Provenance Blockchain for staking and transaction fee payment.
Stake — Hash that has been delegated to a validator to share in the risks and rewards of participating in the PoS consensus mechanism on the blockchain network. Hash will become stake at the point in time that it is delegated to a validator to be used as voting power on the network.
Delegation — staking Hash with a validator to be used by that validator as voting power. For most holders of Hash delegation is an easy and relatively safe method of sharing in the ownership and rewards of the network.
See Voting for more information on how to vote on Governance proposals.
Bonded — The state of your Hash at the time when it is delegated to a validator. All bonded Hash is required to go through a 21 day unbonding period that locks the usage of the portion of Hash that has been removed from delegation. During this lock-up period:
you won’t share in the risks or rewards of the network
your Hash won’t be available for transacting
your Hash will be safe from malfeasance by a bad acting validator.
Re-delegation — Re-delegation of Hash to a different validator occurs immediately, without incurring the 21 day unbonding period. This is incredibly important because it allows the Hash holder to secure their Hash with a trusted validator if the current one has been deemed untrusted. Re-delegation is also the recommended way to move your stake from a validator that has or is going off line for extended maintenance to avoid an availability penalty being assessed against your stake.
Our Staking Services
Why Choose Us to Manage Your Assets
- We have started 7/24 staking services since 2018, and have managed over $100 million assets.
- We run highly available and redundant nodes in different data centers to achieve continuous operations.
- We are actively participating in community and governance, disclosing information frequently.