Sui Hashi Testnet is performing way beyond expectations

Testnet Numbers Tell the Story

Activity on @SuiNetwork's Hashi testnet has been brisk since it went live on July 22, with cumulative $BTC deposits surpassing 1.1 million and withdrawals topping 165,000 in just three weeks. The protocol now accounts for over 50% of $BTC Signet transactions over the past 14 days, with more than 25 institutional participants actively stress-testing the system.

The pace points to early appetite for bringing native bitcoin into DeFi without wrapping or bridging the asset, a model that has drawn renewed interest after repeated bridge exploits drained hundreds of millions from other chains.

How Hashi Works and Who Is Backing It

Unlike conventional wrapped-asset bridges, Hashi does not move $BTC off the Bitcoin network. Users deposit native bitcoin, Sui validators confirm the transaction, and the protocol mints hBTC, a representative token usable as programmable collateral for institutional lending and stablecoin borrowing. Deposits are secured through a 2-of-2 multisig arrangement combining Hashi's multi-party computation (MPC) validators with a separate Guardian Layer, a configurable risk-management system designed to slow or block suspicious withdrawals. Loan terms and collateral positions are recorded onchain, giving lenders direct visibility into how much bitcoin backs any given position.

More than 25 institutional partners are testing lending and credit applications on the testnet, including custody provider BitGo, trading firms Cumberland and FalconX, hardware wallet maker Ledger, infrastructure provider Blockdaemon, exchange Bullish, and Sui-native lending platforms Navi and Scallop. Wave Digital Assets has committed to a three-year plan to tokenize bitcoin-yield-bearing bonds on Sui once Hashi reaches mainnet.

On the compliance side, attorneys at Fenwick, an AmLaw 100 firm widely recognised in digital assets, concluded that locking $BTC through Hashi and receiving hBTC should not constitute a taxable event under U.S. federal income tax law, removing a key friction point for institutional adoption.

Hashi's Guardian Layer must still clear security reviews before any mainnet transition begins, and no launch date has been announced. The early testnet figures arrive at a difficult moment for the broader BTCFi sector, with layer-2 BTCFi total value locked falling roughly 74% from its 2025 highs to around 91,000 BTC by mid-2026.

Sources:
Bitcoin.com: Sui's Hashi Bridge Tops 1.1 Million Bitcoin Deposits in 3 Weeks
Sui Blog: Hashi Testnet Is Live
TechTimes: Bitcoin Collateral Reaches DeFi Without Wrapping