Hacken Is Selected for EU Sandbox 2nd Cohort

BREAKING: Hacken has been selected as one of only 20 pioneering projects for the second cohort of the European Blockchain Sandbox. The sandbox is the EU’s playground for blockchain innovation, fostering regulatory dialogues and legal certainty for distributed ledger technology (DLT) solutions across sectors.

At Hacken, we lead in Smart Contract and Blockchain Security Analysis. From strengthening Web3 defenses against cyber threats to pioneering the conversion of utility tokens into equity, Hacken has presented compelling blockchain use cases that earned us our place in the European Blockchain Sandbox Initiative’s second cohort. We are actively shaping the future of DLT applications while contributing to regulatory standards, a sentiment shared by all 20+ cases selected by the Sandbox.

🚀 The wait is over! We’re thrilled to announce the innovative use cases selected for our 2nd cohort! 🎉

Check out the full list of selected use cases on our news item: https://t.co/USIz9FxTTB#Innovation #Blockchain #DLT #Regulation pic.twitter.com/quQE3hQszM

— European Blockchain Sandbox (@EuropeanSandbox) June 13, 2024

Hacken Joins European Blockchain Innovators in the 2nd Cohort of the European Blockchain Sandbox

The European Blockchain Sandbox is an initiative designed to foster innovation and regulatory clarity for blockchain technology across Europe. It provides a platform for collaboration between regulatory bodies and selected projects, facilitating the development of compliant blockchain solutions.

Hacken, a trusted blockchain security auditor, has been selected for the second cohort. Hacken will focus on ensuring the security and compliance of DLT projects, Layer 1 protocols, and decentralized applications (dApps). Our collaborative work includes developing international blockchain standards and assisting projects in consumer and investor protection while complying with EU regulations like MiCA and DORA. In particular, Hacken team members are actively contributing to security standards under various organizations and regulators, including the DMCA, EEA, ERC3643, C4, and INATBA.

Hacken’s innovative contributions include the Hacken Equity Share (HES) for equity tokenization. By participating in the European Blockchain Sandbox, Hacken aims to enhance blockchain technology’s security and regulatory frameworks, driving forward the adoption and trust in blockchain solutions.

Take a Look at Other Participants

Hacken now joins the ranks of the 20 most innovative blockchain-based projects across Europe. These projects span various sectors such as energy and utilities, education, healthcare, mobility, finance and insurance, and logistics and supply chains. Circularise is renowned for its secure data sharing in supply chains, DigiShares pioneers in real estate tokenization, Infineon Technologies excels in IoT edge data solutions, IOTA leads in decentralized identification, and OriginTrail focuses on AI-driven decentralized knowledge graphs.

For more details on all the finalists, visit the European Blockchain Sandbox announcement.

Hacken’s Proposal for European Blockchain Sandbox

So, what exactly are we bringing to the European blockchain landscape, and why has Hacken been selected? In short, Hacken pioneers Smart Contracts and blockchain Security Analysis, ensuring reliability in DLT projects. From fortifying Web3 against hacks to transforming utility tokens into equity with $HES, we shape finance’s future while meeting regulatory standards.

1. Smart Contract and Blockchain Security Analysis

By prioritizing the security and reliability of smart contracts, L1 protocols, dApps, and overall infrastructure, we demonstrate our commitment to delivering high-quality solutions that meet the needs of DLT projects while protecting consumers and preserving market stability. Our dedication to excellence in security and reliability sets us apart in the blockchain industry, empowering us to innovate with confidence and drive the adoption of decentralized technologies.

Hacken has already provided security analysis services for the EBSI, which you can read more about here. Additionally, Hacken is actively involved in developing international blockchain specifications and standards, driving harmonization and interoperability in the DLT industry worldwide. This includes a pioneering partnership with ADGM, marking the first case where a regulator and auditor join forces to elevate blockchain security standards.

2. Cybersecurity in the DLT Market Infrastructure

The emerging area of infrastructure leveraged by the DLT Pilot regime requires a complex approach and alignment with the regulators on the EU and national levels.

Hacken specializes in helping Web3 and fintech projects prevent hacks and fraud and strengthen consumer and investor protection.

In light of MiCA and DORA requirements and other laws regulating crypto-assets, sufficient levels of DLT projects’ transparency, market abuse detection, and operational resilience on-chain and off-chain have yet to be determined. 

3. Equity Tokenization

In this proof of concept, Hacken has issued 100 Hacken Equity Share (HES) tokens on the Ethereum Mainnet, corresponding to 10% of the company’s equity. These tokens can be purchased exclusively through the utility token HAI, allowing Hacken’s community to become legal co-owners by passing KYC and being whitelisted. This tokenization approach grants community members participation rights in the company, including potential voting rights and dividends.

HES token owners can buy and sell their tokens as digital assets mainly through peer-to-peer mechanisms, as private equity cannot be traded on existing secondary markets. We are exploring the DLT Pilot regime to facilitate the trading of tokenized private equity tokens, aiming to add liquidity while ensuring compliance with current laws.

Related: Tokenization Of Real-World Assets (RWAs): Explanations & Future Outlook

About European Blockchain Sandbox

The European Blockchain Regulatory Sandbox for Distributed Ledger Technologies (DLT) is an initiative by the European Commission aimed at fostering innovation in blockchain technology across various industry sectors, such as energy, healthcare, finance, and logistics. This sandbox establishes a pan-European framework for regulatory dialogues, providing a safe and confidential environment for innovators and regulators to interact. The goal is to increase legal certainty for blockchain solutions by identifying and addressing regulatory obstacles through constructive dialogue and legal guidance.

Starting in 2023, the sandbox will annually support cohorts of 20 blockchain use cases chosen based on their business maturity, regulatory relevance, and alignment with EU policy priorities. These use cases will be matched with relevant national and EU regulators to engage in regulatory discussions, share best practices, and enhance understanding of cutting-edge blockchain technologies. The initiative is managed by a consortium led by Bird & Bird, with the selection process overseen by independent academic experts from European universities. Each year, the most innovative regulator in the sandbox will be awarded a prize, further promoting excellence in regulatory practices.

To learn more about the initiative, visit the European Blockchain Sandbox website.

What’s Next

What a journey it has been for Hacken: starting as a small group of bug hunters in 2017 when crypto was a wild west to now leading standard formulation as a trusted blockchain security auditor. We still have a long way to go. The next steps for Hacken in the European Blockchain Sandbox include engaging in sandbox dialogues, collaborating with regulators, attending orientation sessions, ensuring documentation compliance, leveraging expert guidance, networking with peers, and monitoring official announcements for updates.

Thanks for your ongoing support. Let’s work together, challenge ourselves, and make Web3 a safer place for everyone.