Hydra-Based Roaming Settlement System for Teleco Operators

[Proposal setup] Proposal title

Please provide your proposal title

Hydra-Based Roaming Settlement System for Teleco Operators

[Proposal Summary] Budget Information

Enter the amount of funding you are requesting in ADA

95000

[Proposal Summary] Time

Please specify how many months you expect your project to last

12

[Proposal Summary] Translation Information

Please indicate if your proposal has been auto-translated

No

Original Language

en

[Proposal Summary] Problem Statement

What is the problem you want to solve?

Roaming settlements are slow, costly, and rely on clearinghouses, raising prices for customers. A perfect real-world B2B usecase for Hydra - a faster, cheaper, and more transparent alternative.

[Proposal Summary] Project Dependencies

Does your project have any dependencies on other organizations, technical or otherwise?

No

Describe any dependencies or write 'No dependencies'

No dependencies

[Proposal Summary] Project Open Source

Will your project's outputs be fully open source?

Yes

License and Additional Information

Open Source License: We will release all project outputs under the Apache License 2.0. This permissive license is chosen to encourage maximum adoption and collaboration. It allows telecom operators or other developers to freely use, modify, and integrate our code into their systems, even for commercial purposes, with minimal restrictions.

All components of our MVP will be open-sourced. This includes onchain code, offchain code and any tooling or simulation code developed for the project.

[Theme Selection] Theme

Please choose the most relevant theme and tag related to the outcomes of your proposal.

Financial Services

[Campaign Category] Category Questions

Describe what makes your idea innovative compared to what has been previously funded (whether by you or others).

This well-defined problem – inefficient inter-operator roaming settlement – is a real-world usecase that demonstrates the power of Hydra

International Roaming settlement is a fresh, untested use case on Cardano – exactly what the “Use Cases: Concepts” fund is meant to explore.

No prior Catalyst project has tackled telecom roaming is unique in combining Hydra (bleeding-edge Cardano tech) with a telecom business problem.

It’s an ambitious yet achievable concept that could revolutionize how telecoms do business while showcasing Cardano’s tech to the world.

Describe what your prototype or MVP will demonstrate, and where it can be accessed.

We will build and demonstrate a working prototype of roaming settlement on Cardano Hydra L2. It will prove that two operators can settle hundreds or thousands of roaming transactions per second with no middleman, in a trustless manner.

Describe realistic measures of success, ideally with on-chain metrics.

Reusability of Deliverables

• Target: At least 2 stand‑alone components (e.g., TAP-to-Cardano converter, Hydra B2B workflow) downloaded or forked from GitHub by external developers within 3 months of release

Industry Interest

• Target: At least 1 letter of interest from a telecom operator or vendor to explore a pilot after MVP demo.

[Your Project and Solution] Solution

Please describe your proposed solution and how it addresses the problem

Ever checked your phone bill after a holiday abroad and wondered why roaming is still so expensive in 2025? Behind the scenes, telecoms are using decades-old settlement systems that take weeks, cost millions, and waste time (and you pay for it). We’re replacing that with Hydra — instant, trustless, and nearly free.

Every time you travel abroad and use your phone, your mobile operator has to pay another operator in that country for letting you use their network. This is called roaming, and behind the scenes it’s a huge mess.

Today, operators settle these roaming bills through middlemen called clearing houses. These clearing houses collect records of your calls, texts, and data usage, check them, and handle the payments between the two operators.

The problem is:

1. It’s slow – Settlements can take weeks or even months after you used the service.
2. It’s expensive – Clearing houses charge fees, and operators also spend a lot on manual checks and paperwork.
3. It’s not very transparent – If there’s a mistake or fraud, it can take ages to spot and fix.

All these costs and delays ultimately get passed on to you, the customer – which is part of why roaming can be expensive and unpredictable !

We will replace the slow, costly clearing house system with a fast, automated settlement platform built on Cardano’s Hydra Layer 2 technology.

• Operators will exchange usage and payments in real time directly with each other, using secure smart contracts.
• Hydra processes these transactions instantly and almost for free, and only occasionally finalizes them on Cardano’s main blockchain for security.
• This means no middleman fees, fewer errors, faster cash flow for operators, and lower costs for customers.

In our solution, roaming usage events (calls, data sessions) are recorded as transactions on a shared Hydra Head between two operators. Smart contracts on Cardano will automatically calculate and settle charges according to the agreed tariff rules. By leveraging Hydra, these transactions are processed off-chain at high speed and near-zero cost, then periodically settled on the Cardano main chain for security.

We will deliver a working prototype of this system – effectively a proof-of-concept for telecom roaming payments running on Cardano. This solution directly addresses the stated problem by eliminating manual reconciliation and delays: instead of monthly clearing, operators can settle in seconds via Hydra. The MVP will validate that a Cardano-based approach can reduce cost, prevent disputes (via a tamper-proof ledger), and enable instant, trustless settlement of roaming fees.

The MVP will consist of:

1. A Hydra Head network connecting two mock telecom operators (simulating a Home Network and a Visited Network). This Hydra Head will act as a private ledger for the two parties to log usage and payments in real-time.
2. Smart contracts (Plutus scripts) representing the roaming agreement terms. These will encode the tariff rates (e.g., $0.xx per MB of data, per minute of call) and business logic (discounts, caps, etc.). The contract ensures that for each usage event recorded, the correct charge is computed and allocated to the operators.
3. An off-chain service/oracle that listens for roaming usage events (from our simulated testbed) and triggers transactions in the Hydra Head. Essentially, when a roaming call or data session occurs, a transaction is created in Hydra representing that event (including necessary details like duration, data volume, etc.) and transferring the appropriate fee from one party’s account to the other’s.
4. Periodic settlement to Layer-1: The Hydra Head will periodically (or upon head closing) commit the net results to the Cardano main chain. For example, after a day of roaming transactions, the head can be snapshot-settled so that the net ADA/USDM owed from Operator A to B is recorded on L1 and funds are transferred accordingly. This gives the finality and security of Cardano’s blockchain for the settled balance while keeping the high-frequency events off-chain on Hydra.

In addition to the benefits and impact of the overall concept, this project will produce several stand‑alone deliverables that have independent value, such as:

1. TAP/CDR to Cardano Tx Converter
   1. A module that parses GSMA TAP3 or CDR files and converts usage events into Cardano-compatible transaction payloads.
   2. Could be reused by any telecom integration with blockchain (billing, fraud detection, IoT roaming).
2. Roaming Tariff Smart Contract Template
   1. A Plutus contract pattern that encodes bilateral (or multilateral) usage settlement rules.
   2. Could be adapted for different inter-operator agreements or even non-telecom B2B settlements.
3. B2B Blockchain Settlement Reference Architecture
   1. Documentation and diagrams showing how to integrate Cardano/Hydra into an enterprise transaction flow.

[Your Project and Solution] Impact

Please define the positive impact your project will have on the wider Cardano community

If successful, our project will demonstrate Cardano’s capability in a new industry (telecom), potentially attracting interest from mobile operators, industry bodies (like the GSMA), and enterprise developers. This could lead to more adoption of Cardano for real-world transactions (increasing on-chain volume via Hydra commits) and possibly new partnerships (e.g., a telco joining as a Cardano enterprise partner). By solving a real problem, we add to Cardano’s credibility as a blockchain that moves beyond DeFi into wider use cases. In concrete terms, success could mean:

1. More on-chain activity: Each Hydra head settlement will create Cardano transactions. If this approach is adopted industry-wide, it could translate to significant ADA transaction volume (which benefits network utility and fees for stake pool operators)
2. ADA as a reserve currency for telecom settlement: Our prototype uses ADA for simplicity, but imagine if operators held ADA to use in Hydra heads for settlements – that’s a new demand source for ADA and increases its utility.
3. Knowledge transfer: The open-source code and documentation become an asset for the community.

It also demonstrates the power of Hydra to telecom operators.

[Your Project and Solution] Capabilities & Feasibility

What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

I’ve spent over 10 years delivering complex IT solutions in telecom and finance, and today I’m a Senior IT Solution Architect in a Telecom Company.

I’m also an EMURGO Certified Cardano Solution Architect and have built several blockchain projects — from Plutus smart contracts to full dApps — that are already running in the Cardano ecosystem. In fact, I’ve already delivered two successful Catalyst-funded projects, so I know the process, the reporting, and how to deliver on what I promise.

With hands-on experience in telecom and financial industry and strong knowledge of Cardano’s tech stack , I’m in a verry good position to make this project a reality.

[Milestones] Project Milestones

Milestone Title

Design & Hydra Environment Setup

Milestone Outputs

1. System Architecture and Design Docs: Diagrams and descriptions of the solution’s architecture, including Hydra Head setup, smart contract flow, off-chain components, and data models for usage records.
   1. Component Diagrams: Highlighting the organization and dependencies among components. (might include smart contracts, backend servers, external APIs, oracles, etc.)
   2. Use Case Diagrams: These help in identifying the different actors (users, other systems) and their interactions with the solution.
   3. State Machine Diagrams: Very relevant for smart contracts to depict the different states a contract can be in (e.g., open, closed, funded) and the transitions between these states, triggered by transactions or events.
   4. Class Diagrams: Useful for representing the structure of the datums of smart contracts.
   5. Sequence Diagrams: These can depict the interactions over time between actors (operators), the solution, external systems, and the underlying blockchain. This might show the sequence of calls to a smart contract function, how events are emitted, or how off-chain components interact with the blockchain.
2. Hydra Environment Setup: Deployment of a Hydra Head on a test network (could be on Cardano testnet or a private devnet) connecting at least two parties. This will include running Cardano nodes and Hydra nodes, and verifying they can open/close a head and perform basic transactions.
3. Prototype Smart Contract (alpha version): A simple Plutus script outline that can handle a basic payment between two parties (as a placeholder for full logic) – this is to validate the end-to-end connectivity early.

Acceptance Criteria

• The International Roaming Settlement should be described with UML diagrams depicting the it's structure and dynamics.
• The Hydra test network is successfully running: we can open a Hydra Head and exchange test ADA between two nodes within it.
• The initial smart contract can be deployed to the testnet and invoked in a trivial transaction (e.g., moving a small amount from A to B), confirming our dev environment for Plutus is correctly configured.

Evidence of Completion

GitHub release tag with all code, links, forum thread with community discussion, and documentation in markdown or PDF format.

Delivery Month

3

Cost

30000

Progress

30 %

Milestone Title

Core Development

Milestone Outputs

1. Plutus smart contract implementing roaming tariff logic.
2. Off-chain service for ingesting CDR/TAP data and preparing Hydra transactions.
3. Simulated Roaming Data Generator.
4. Updated technical documentation for each component.

Acceptance Criteria

1. Smart contract correctly calculates fees for at least 10 simulated roaming events.
2. Off-chain service generates valid Hydra transaction payloads for test data.
3. Simulation tool produces realistic event data (calls, SMS, data sessions).

Evidence of Completion

1. GitHub repository with smart contract, off‑chain code, simulator, and test scripts.
2. Test run reports (e.g., JSON/JUnit format) showing all unit tests passed.
3. Sample TAP/CDR input and generated Hydra transaction JSON in repo.

Delivery Month

6

Cost

35000

Progress

70 %

Milestone Title

Integration, Testing and Documentation

Milestone Outputs

1. Integration of Components: The system is integrated end-to-end: the simulator triggers events, the off-chain code catches them and posts to Hydra, Hydra records them, and the smart contract logic computes the charges.
2. Updated Documentation: Code is commented, and we produce a short technical manual on how to deploy and run the MVP (this will later be polished for external use, but even at this stage, we maintain docs).
3. Full Test Suite Execution: Functional, performance, resilience, and security tests to validate the integrated MVP.
4. Updated Documentation: Well‑commented code and a short technical manual on how to deploy and run the MVP (later polished for external use).

Acceptance Criteria

• All core features described in the proposal are implemented and functioning in a development environment. Concretely: if we run the simulator for, say, 10 sample roaming events, the system processes them and we can show that the charges have been applied (e.g., Operator A’s balance decreased by the correct total and Operator B’s increased).
• End-to-end integration test: simulator → off-chain service → Hydra Head → L1 settlement.
• Documentation meets open-source standards and is complete
• Deployment Instructions and Runbook must be publicly available

Evidence of Completion

GitHub release tag with all code, links, forum thread with community discussion, and documentation in markdown or PDF format.

Delivery Month

9

Cost

15000

Progress

90 %

Milestone Title

Milestone 4: Project Close-out and Delivery

Milestone Outputs

1. Documentation & Guides: Finalize all documentation – this includes in-line code documentation, a README or perhaps a docs site that covers how to deploy the solution, how the smart contracts work, how to extend it, etc. Also, an API document if our off-chain component exposes any APIs.
2. Project Handover Materials: If the project were to be continued (either by us in a next fund or by another team), we’ll prepare a brief “handover” note listing things like pending features (e.g., “if we had more time, we’d add multi-currency support”), known issues or limitations of the MVP, and suggested next steps.
3. Final Project Report: A comprehensive report as required by Catalyst, including an executive summary, what was achieved vs. proposed, all metrics of success, lessons learned, and future recommendations. This report will be written in a community-friendly way and will be made public.
4. Final Video Demo : This video will serve both as our Catalyst close-out video and a tutorial for interested developers.

Acceptance Criteria

• Catalyst Close-Out Complete : The Catalyst-required close-out report and video are submitted and meet the acceptance of the Catalyst team (meaning they are sufficiently detailed and clear).
• Open Source Accessibility: We ensure the repository is public, licensed, and the link is shared on popular channels. Acceptance here is simply that the code is accessible and runs on machines other than our own. We will test a fresh clone on a new environment as verification.

Evidence of Completion

GitHub release tag with all code, published video tutorial links, forum thread with community discussion, and documentation in markdown or PDF format.

Delivery Month

12

Cost

15000

Progress

100 %

[Final Pitch] Budget & Costs

Please provide a cost breakdown of the proposed work and resources

Milestone 1 – Design & Hydra Setup – 30,000 ADA (≈1 FTE over 3 months)

• Architecture & design documentation – 20,000 ADA | 1 FTE | 8 weeks
• Hydra Head testnet setup – 5,000 ADA | 1 FTE | 2 weeks
• Alpha Plutus contract – 3,000 ADA | 1 FTE | 1 weeks
• Infrastructure cost – 2,000 ADA

Milestone 2 – Core Development – 35,000 ADA (≈1 FTE over 3 months)

• Plutus smart contract (tariff logic) – 14,000 ADA | 0.6 FTE | 8 weeks
• Off‑chain TAP/CDR ingestion service – 6,000 ADA | 0.4 FTE | 8 weeks
• Roaming Data Generator – 5,000 ADA | 1 FTE | 2 weeks
• Unit testing and QA – 3,000 ADA | 0.5 FTE | 2 weeks
• Docs – 2,000 ADA | 0.5 FTE | 2 weeks

Milestone 3 – Integration and Testing – 15,000 ADA (≈1 FTE over 3 months)

• End‑to‑end integration – 10,000 ADA | 0.5 FTE | 8 weeks
• Docs – 5,000 ADA | 0.5 FTE | 4 weeks

Milestone 4 – Close‑out & Open Source Release – 15,000 ADA (≈1 FTE over 3 months)

• Final documentation & guides – 4,000 ADA | 0.3 FTE | 11 weeks
• Open‑source release prep – 3,000 ADA | 0.2 FTE | 11 weeks
• Final report & video tutorial – 4,000 ADA | 1 FTE | 1 weeks
• Post‑release support – 2,000 ADA | 1 | 1 weeks

Total = 95,000 ADA

[Final Pitch] Value for Money

How does the cost of the project represent value for the Cardano ecosystem?

I'm asking for 95,000 ADA to build a working, open‑source solution that could save telecom operators millions by replacing costly roaming middlemen with Cardano’s Hydra technology.

In a year, I’ll deliver:

• A complete MVP that proves Cardano can handle real‑world, high‑value telecom settlements.
• Open‑source tools that anyone can reuse (even outside telecom).
• A public demo and documentation so others can adopt it quickly.

This is a small investment compared to traditional telecom pilots (which can cost over $500,000), but it has the potential to drive huge adoption and on‑chain activity for Cardano.

Telecoms are under pressure to cut costs and modernize settlement — we can be the first to show them blockchain works today, before competitors lock in other platforms.

We’ll prove Cardano can replace billion-dollar clearinghouses — and we’ll give the tools to the world, open source.

[Required Acknowledgements] Consent & Confirmation

Terms and Conditions:

Yes