Sui launched the Hashi testnet to enable native Bitcoin lending, borrowing, and programmable collateral with enhanced institutional security.
Sui has officially launched the Hashi testnet, marking a major step for Bitcoin finance. The new protocol enables native Bitcoin to be programmable collateral without the need for traditional blockchain bridges. Consequently, institutions could receive new on-chain lending, borrowing, and management capabilities for Bitcoin.
According to Sui official statement, Hashi was originally launched in March by the original contributor to Sui, Mysten Labs. Since then, the project has been dedicated to creating secure infrastructure for financial markets based on Bitcoin. Furthermore, the launch is designed to free up over $1 trillion in sleeping Bitcoins in the worldwide market.
What Is the Sui Hashi Testnet and Why Does It Matter for Bitcoin?
With Hashi, Bitcoin owners can utilize their assets without having to transfer them off the Bitcoin network. This means that developers can build lending, credit and liquidity applications without compromising Bitcoin’s native security model.
In March, Hashi was first introduced: a new way to put $BTC to work on Sui without moving it off the Bitcoin network.
Today, Hashi testnet is live.
— Sui (@SuiNetwork) July 22, 2026
Despite being the biggest cryptocurrency in the world, Bitcoin has been relatively quiet, Sui said. Thus, Hashi aims to establish institutional-level markets for lending and borrowing, and fixed-income products secured by Bitcoin collateral.
According to Adeniyi Abiodun, Co-Founder and Chief Product Officer of Mysten Labs, “All major asset classes eventually get lending and liquidity markets. He also noted that Bitcoin is on the same trajectory as institutional demand grows.
Additionally, Hashi adds programmable functionality to many Bitcoin products that are lacking today. This enables institutions to create financial services in a more transparent and automated way.
The protocol also provides complete transparency of collateral status and loan conditions on-chain. This allows market participants to track positions in real time and minimize uncertainty in operations.
As the industry has been looking for safe methods to invest in Bitcoin capital, the market has become more competitive. The market has become more competitive as industry participants have been looking for secure methods to invest in Bitcoin capital. This could lead to projects such as Hashi to help grow Bitcoin beyond just storage and payments.
How Does Hashi’s Guardian Layer Protect Native Bitcoin Collateral?
One of the key features announced for the testnet launch is the Guardian Layer. This is another layer of security to ensure the safe transfer of collaterals and high-value transactions throughout the Hashi ecosystem.
All Bitcoin collateral is based on a 2-of-2 multisignature model on The Guardian Layer. In particular, all transactions must be approved by both Hashi validators and independent guardians before they can be executed.
This model provides an additional layer of protection from malicious activity. Thus, institutions can put in place measures to slow or stop suspicious transactions from taking place, before the assets remove themselves from the system.
Furthermore, the Guardian Layer provides flexible security options for various operational requirements. Such safeguards are seen as vital for institutional adoption in regulated financial markets.
Automated collateral management and clear reporting tools are also built into Hashi’s protection. This means that institutions can keep a check on what is happening without compromising the efficiency of blockchain.
Security is one of the primary concerns with cross-chain activity. But Hashi tries to eliminate many of the risks associated with the bridges by maintaining Bitcoin’s connection to its native network.
Can Hashi Accelerate Institutional Adoption of Bitcoin Finance?
The Hashi ecosystem is expanding and is now in the testnet stage. In particular, there are a number of decentralized finance, custody, and banking infrastructure providers who have joined the effort.
After devnet participation, Wave Digital Assets has bolstered its support. Furthermore, the company agreed to make its products, which are tokenized Bitcoin yield-bearing bond products, top priority on Sui for 3 years, with best efforts.
Earlier this year, more than 20 launch partners committed to supporting Hashi. These partners encompass custodians, wallet providers, liquidity companies, insurance companies, and infrastructure companies.
The increasing number of partners in the network also indicates a growing institutional interest in programmable Bitcoin markets. Market participants are still working on integrating legacy financial services with blockchain.
Sui’s Hashi testnet comes at a time when institutional demand for digital assets is on the rise globally. Therefore, its success could influence how Bitcoin is used across lending, credit, and capital markets in the coming years.
Bilal Hassan is a seasoned crypto journalist with over five years of experience covering blockchain, digital assets, and global fintech trends. His work focuses on market developments, regulatory shifts, and the evolving landscape of cryptocurrency adoption worldwide.