Cardano Institutional UX Stack: Compliance & BTC-Ready DeFi

[Proposal setup] Proposal title

Please provide your proposal title

Cardano Institutional UX Stack: Compliance & BTC-Ready DeFi

[Proposal Summary] Budget Information

Enter the amount of funding you are requesting in ADA

825000

[Proposal Summary] Time

Please specify how many months you expect your project to last

7

[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?

Cardano’s growing institutional and regulated DeFi potential is limited by fragmented UX, missing identity standards, and inconsistent compliance flows - limiting adoption for both ADA and BTC DeFi.

[Proposal Summary] Supporting Documentation

Supporting links

• https://www.sundialprotocol.com/
,
• https://sundae.fi/
,
• https://fluidtokens.com/
,
• https://fairway.global/

[Proposal Summary] Project Dependencies

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

Yes

Describe any dependencies or write 'No dependencies'

Yes. Our project has key dependencies: 1) Cardano mainnet (including Babel fees). 2) Balius framework (TxPipe) for transaction orchestration. 3) FluidTokens lending contracts upgraded for identity checks. 4) SundaeSwap (via SundaeLabs) DEX contracts upgraded for identity checks. 5) Bitcoin bridging and Sundial deployment interface. 6) Fairway identity SDK and trusted KYC/credential issuers. 7) Security audits of updated contracts. 8) Institutional stakeholders for UX and compliance validation. The framework is modular and extensible: protocols and tools can be adopted, replaced, or skipped depending on the needs of each stage of the project.

[Proposal Summary] Project Open Source

Will your project's outputs be fully open source?

Yes

License and Additional Information

All infrastructure outputs will be fully open-source under MIT licence, and available on Github.

[Theme Selection] Theme

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

Identity & Verification

[Campaign Category] Category Questions

Describe your established collaborations.

Four proven Cardano teams unite to deliver institutional-grade UX and identity standards. Sundial leads with expertise in cross-chain liquidity and compliance, shaping design for institutional BTC-ADA flows. Fairway provides UX, compliance, and identity frameworks, ensuring modular, reusable infrastructure. SundaeLabs and FluidTokens integrate real use cases - BTC/ADA trading and BTC-collateralized lending - testing design through live protocols. Together, the teams bring years of Cardano experience, cross-functional depth, and a commitment to open, scalable infrastructure.

Describe funding commitments.

Our project spans 6 milestones with a total budget of 825k ADA. Sundial leads institutional research, BTC UX, and mainnet launch (≈191k ADA). Fairway drives UX, identity, compliance, frontend, and SDK delivery (≈356k ADA). FluidTokens upgrades lending contracts, integrates Aquarium (Babel Fees), and co-develops adapters (≈181k ADA). SundaeLabs supports DEX upgrades, runtime setup, and testing (≈95k ADA). Costs cover research, design, smart contracts, UX, audits, and deployment. All outcomes are to be open sourced.

Describe your key performance metrics.

KPIs include: completion of BTC institutional research reports; delivery of UX/identity prototypes and audited smart contract upgrades; launch of reusable SDKs, docs, and onboarding guides; integration of Aquarium fee system and BTC UX flows; successful deployment of identity-gated lending and DEX contracts; mainnet launch with at least 2 live protocol integrations (Sundae, FluidTokens); 3+ institutional partner tests; and open-source release of the integration framework.

[Your Project and Solution] Solution

Please describe your proposed solution and how it addresses the problem

As Cardano prepares to support institutional users and Bitcoin-native DeFi, there's a growing need to ensure that identity, compliance, and user experience are thoughtfully designed to meet real-world expectations. Institutional actors - from fintechs to asset managers - require more than just protocol access; they need clarity, trust, seamless onboarding, and regulatory assurance. Without coordinated UX and identity infrastructure, these users face fragmented journeys, repeated KYC steps, and confusion over which DeFi tools are safe and suitable for their use cases.

Our project proposes to research, design, and build a unified UX and identity framework specifically for institutional and BTC-backed DeFi use on Cardano. In collaboration with Sundial, FluidTokens, and Fairway, and with technical contributions from SundaeLabs (engaged as a contractor), we will map out key institutional workflows - such as lending with BTC, trading BTC/ADA, or launching a permissioned pool - and design interfaces that make these actions intuitive and compliant by default.

This begins with deep collaboration: Fairway and Sundial will lead interviews with institutional stakeholders to identify how products should work, what identity providers are acceptable, and what user requirements (like jurisdiction or accreditation) are necessary. This real-world grounding will shape the architecture from the start.

We then move into user journey design: Fairway will create and prototype user flows that allow individuals to interact with regulated DeFi products - such as trading, lending, or borrowing - in a seamless way. Identity requirements will be embedded in the experience, with checks happening automatically and unobtrusively. If a user doesn’t meet the criteria (such as lacking KYC), they will be prompted to verify and then granted access through an on-chain credential.

The resulting system consists of three main components:

1. A user-facing interface

A unified, accessible frontend where users can connect their wallet, onboard Bitcoin, and access compliant DeFi products - including lending, trading, and borrowing - in a single place.

1. An identity center

A profile interface where users can manage KYC and other credentials, check which products they’re eligible for, and understand their permissions across protocols. This identity layer uses reusable on-chain ID Access Control and privacy-preserving proofs to minimize friction and protect user data.

1. A shared backend framework for protocol access

A backend service layer will handle transaction creation and off-chain orchestration, enabling interaction with multiple protocols. We will build on top of existing headless dApp infrastructure (Balius - https://github.com/txpipe/balius) to compose transactions, fetch and include identity ID Access Controls, and adapt to each protocol’s requirements. Fairway will integrate its identity credential discovery tools directly into this backend layer.

Partner protocols such as FluidTokens and SundaeSwap (via SundaeLabs) will integrate their smart contracts into this system. SundaeLabs is not a co-proposer, but will be engaged as a contractor by Sundial to deliver specific integration milestones, such as upgrading the DEX contract and building the Balius adapter for trading.

This solution will be deployed on Cardano mainnet and launched directly on Sundial when available, giving immediate access to Bitcoin-native DeFi through a regulated-friendly experience. Through this interface, users can access trusted DeFi opportunities from multiple protocols, with compliance seamlessly handled in the background.

Importantly, the system is open and extensible. It is designed so that any Cardano DeFi project can integrate identity-aware access and become discoverable through a shared user interface, helping scale adoption without requiring each project to build its own infrastructure.

This product addresses a core challenge: giving everyday users and institutions a clear, compliant way to engage with DeFi on Cardano. It removes friction, builds trust, and creates a foundation that other projects can adopt and extend.

[Your Project and Solution] Impact

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

This project will create foundational infrastructure that makes Cardano DeFi truly accessible, compliant, and user-friendly - not just for institutions or Bitcoin users, but also for the real-world teams building regulated financial applications on top of Cardano.

At its core, the project delivers a reusable, modular product - a frontend and backend system that connects identity, compliance, and DeFi protocols through a shared interface and standard architecture. This empowers other builders to launch their own compliant DeFi apps, targeting real users in real markets.

With this system:

• Fintech teams can easily launch white-labeled apps powered by Cardano DeFi (e.g., a BTC savings app in a licensed market).
• Builders can configure access rules - such as requiring KYC or limiting usage by jurisdiction - using Fairway’s integrated identity layer.
• Protocols like SundaeSwap and FluidTokens or similar platforms who plug in, gain more adoption as their services are made accessible through unified interfaces, without needing to build consumer apps themselves.
• Bitcoin-native users can access Cardano DeFi (via Sundial) without needing to manage separate chains or infrastructure.

This means faster product development, more compliant options, and greater real-world adoption - all while preserving decentralization and openness.

For the Cardano ecosystem, the impact includes:

• Stronger developer tooling: Teams can plug into existing infrastructure and go to market faster.
• Wider protocol usage: Integrated protocols become part of multiple apps and services, not just their own UI.
• Institutional capital access: DeFi no longer looks like an experimental playground - it becomes a usable, trusted platform for professional-grade services.
• New types of apps: From regional fintech services to domain-specific DeFi platforms, the door opens to an entirely new class of builders.

In summary: this project helps evolve Cardano from a protocol ecosystem into a product-ready platform - where real services for real users can launch at scale.

[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?

This proposal brings together four experienced Cardano ecosystem teams, each with a proven track record of delivering complex products at both the protocol and infrastructure levels:

Sundial (Lead Applicant & Institutional Design Partner)

Sundial is developing the infrastructure that brings Bitcoin-native liquidity into Cardano through non-custodial atomic swaps — a core innovation that opens Cardano DeFi to the largest crypto asset class. As the lead applicant, Sundial anchors this project by:

• Leading early research into BTC user needs
• Shaping product design for institutional BTC flows
• Ensuring seamless compatibility with their upcoming mainnet launch
• Engaging with potential institutional participants and strategic partners

Their deep understanding of cross-chain primitives, compliance concerns, and institutional capital needs makes them ideally suited to guide the solution’s direction and align it with real adoption opportunities.

Fairway (UX, Identity & Integration Partner)

Fairway brings specialized expertise in institutional UX design, compliance infrastructure, and identity management.

The team is responsible for:

• End-to-end UX research and design
• Development of the identity framework (including Identity based access control on-chain)
• Frontend implementation and backend coordination
• Creating scalable infrastructure that other protocols can reuse

Fairway has already developed identity prototypes and worked with institutional actors on ZK and identity systems within the Cardano ecosystem. Its modular, protocol-agnostic approach ensures this solution can scale beyond the initial use cases.

SundaeLabs & FluidTokens (Protocol Integration Partners)

SundaeSwap (via SundaeLabs) and FluidTokens are two of Cardano’s most active DeFi protocols.

They bring real-world use cases to the project, including:

• BTC/ADA trading pools (Sundae)
• BTC-collateralized lending (FluidTokens)
• Testing and refining the user experience from both a frontend and smart contract perspective

Their early involvement ensures that the solution is not theoretical, but grounded in real integration work with protocols that are live and operational today.

Track Record & Commitment

All four teams are long-term ecosystem participants, active builders, and open contributors. Together, they represent:

• Multi-year experience shipping Cardano-native products
• Cross-functional capability in smart contracts, frontend, UX, identity, and compliance
• A shared commitment to open infrastructure, ecosystem scalability, and long-term sustainability

Feasibility & Validation Approach

To ensure the solution is feasible and well-validated, we will:

1. Start with grounded research: Interviews with institutional users, TradFi stakeholders, and partner teams will shape real user journeys and define edge cases early.
2. Design collaboratively: All partner protocols will be involved in UX prototyping and architecture reviews to ensure alignment and real-world fit.
3. Build in modular stages: We will implement identity UX before infrastructure, allowing for faster testing and incremental delivery.
4. Test on Cardano testnet: Protocol flows will be validated in a test environment first - including BTC-to-cBTC interactions - ensuring contract readiness and safe integration.
5. Launch on mainnet with real use cases: At least one protocol will go live with the framework at launch, with others able to adopt it afterward.

[Milestones] Project Milestones

Milestone Title

Institutional Research, Requirements Mapping & UX/Identity Design

Milestone Outputs

Output 1: Institutional Research Report

Deliverable: Documentation of 5+ stakeholder interviews, mapped BTC-backed DeFi flows (lending, trading, pools), and regulatory/compliance requirements (KYC, credential types, jurisdictional notes).

Output 2: UX & Identity Prototype Package

Deliverable: Figma prototypes and flow diagrams for bridging, lending, trading, plus initial “Identity Center” interface and credential structure with Fairway access control logic.

Output 3: Partner Feedback & Integration Notes

Outcome: Reviewed flow diagrams and requirements signed off by FluidTokens, SundaeLabs, Sundial, and Fairway, ensuring alignment with live protocol needs.

Acceptance Criteria

• Interview at least 5 institutional stakeholders to map requirements.

• Define flows for BTC-backed DeFi use cases (lending, trading, pools).

• Document regulatory needs (KYC provider support, credential types, jurisdiction needs).

• Create UX prototypes for DeFi access (bridging, lending, trading) with simulated BTC onboarding.

• Design “Identity Center” interface for managing credentials.

• Complete identity credential structure and Fairway Identity Access Control flow logic.

• Hold feedback sessions with FluidTokens and SundaeLabs.

Evidence of Completion

• Research report outlining use cases and flow diagrams.

• Institutional UX and compliance requirement summary.

• Figma prototypes + user flows.

• Identity credential specs (technical + UX).

• Partner-reviewed flow diagrams and contributions from Sundial, Fairway and Fluidtokens.

Delivery Month

2

Cost

206250

Progress

20 %

Milestone Title

Core UI Shell & Balius Integration Framework

Milestone Outputs

Output 1: Frontend Shell Deployment

Deliverable: Functional UI shell with wallet connection, navigation, and coordinated layout logic, deployed to test environment or public repo.

Output 2: Balius Runtime Integration

Deliverable: Working Balius framework integrated for headless transaction building, validated with test transactions and partner review.

Output 3: Adapter Architecture & Stubs

Deliverable: Documented modular adapter structure with initial stubs for lending and trading protocols, reviewed with Fairway and SundaeLabs.

Acceptance Criteria

• Frontend shell implemented with wallet connection and navigation

• Balius framework integrated for headless transaction building

• Initial protocol adapters stubbed (lending + trading)

• Coordinated layout logic with Fairway and and partners (likely SundaeLabs)

Evidence of Completion

• Deployed UI shell (live test or repo)

• Working Balius runtime integration

• Architecture doc outlining modular adapter structure

Delivery Month

3

Cost

123750

Progress

40 %

Milestone Title

Identity UX Integration & Credential Resolution

Milestone Outputs

Output 1: Identity Dashboard Deployment

Deliverable: Live UI dashboard showing wallet-linked credential discovery, status display, and KYC initiation, tested end-to-end.

Output 2: Credential Issuance Flow

Outcome: User journey from missing credential → KYC completion → credential minted on-chain, documented with flow diagrams and test logs.

Output 3: Balius Verification Integration

Deliverable: Fairway SDK integrated into Balius, enabling credential verification requests and access-gated mock transactions, with logs proving enforcement.

Acceptance Criteria

• Fairway backend live with credential discovery for user wallets

• Users can see status, initiate KYC, and receive on-chain credential Proofs

• Balius able to request verification from Fairway SDK

• Mock flow with Identity Access Control included in test transactions

Evidence of Completion

• Working identity dashboard in UI

• User flow from missing credential → credential minted

• Balius test logs showing on-chain credential giving users access.

Delivery Month

4

Cost

123750

Progress

50 %

Milestone Title

Smart Contract Upgrades & Identity Enforcement

Milestone Outputs

Output 1: Upgraded Smart Contracts

Deliverable: Lending (FluidTokens) and DEX (SundaeSwap) contracts updated with Fairway-issued identity gating logic, published in public repo.

Output 2: Audit Verification

Deliverable: Independent re-audit reports validating contract upgrades and confirming correct integration of identity enforcement.

Output 3: Testnet Credential Enforcement

Outcome: Demonstrated testnet interactions where only wallets with valid credentials can access lending/DEX functions, with logs shared as evidence.

Acceptance Criteria

• Lending contracts (FluidTokens) and DEX contracts (SundaeSwap) updated to enforce identity checks

• Use of Fairway-issued Access Control embedded in logic

• Internal partner tests confirm gating is enforced

• Re-audits complete for upgraded contracts

Evidence of Completion

• Updated Plutus contract code (in public repo)

• Re-audit reports shared

• Testnet interactions using real or mock identity credentials

Delivery Month

5

Cost

123750

Progress

60 %

Milestone Title

BTC Bridging + Babel Fee Flows (Aquarium)

Milestone Outputs

Output 1: Simulated BTC UX Demo

Deliverable: Interactive demo (video + repo) showing simulated BTC wallet connection, cBTC-style onboarding, and bridging flow via Sundial interface.

Output 2: Aquarium Fee Integration

Deliverable: Functional Aquarium integration enabling fee payment in non-ADA tokens, with sample test transactions demonstrating BTC-based Babel fee abstraction.

Output 3: Protocol Adapter & Integration Tests

Outcome: Balius adapter extended with Aquarium support, validated through integration tests with FluidTokens to confirm compatibility in lending/DeFi flows.

Acceptance Criteria

• Simulated user experience on Cardano for BTC wallet connection and bridging to DeFi
• UX mimics cBTC onboarding via Sundial interface (no live bridging yet)
• Aquarium integrated to allow fee payment in non-ADA native tokens, simulating BTC-based Babel fee use
• Balius adapter includes support for Aquarium fee abstraction

Evidence of Completion

• Demo video showing BTC-like user flow and native token fee payment

• Sample test transactions using Aquarium with non-ADA tokens

• Confirmed functioning with FluidTokens integration

Delivery Month

6

Cost

123750

Progress

80 %

Milestone Title

Mainnet Launch & Open Framework Release

Milestone Outputs

Output 1: Mainnet Deployment

Deliverable: Public launch of Sundial-branded frontend with at least one protocol (e.g., lending or DEX) live on mainnet enforcing identity access.

Output 2: Open Framework Release

Deliverable: Publication of Fairway SDK and Balius protocol adapters in open GitHub repo, with technical documentation for integration.

Output 3: Adoption & Onboarding Resources

Outcome: Comprehensive onboarding guides, partner-reviewed documentation, and feedback reports to support other protocols adopting the framework.

Acceptance Criteria

• Frontend deployed under Sundial brand

• At least one protocol live on mainnet with identity enforcement

• Public Fairway SDK and Balius protocol adapters published

• Onboarding docs for other protocols to adopt the system

Evidence of Completion

• Mainnet contract + frontend URLs

• GitHub repo with docs and SDKs

• Partner feedback and documentation guide

Delivery Month

7

Cost

123750

Progress

100 %

[Final Pitch] Budget & Costs

Please provide a cost breakdown of the proposed work and resources

Milestone 1: Institutional Research & Use Case Mapping + UX/Identity Design (Month 1)

Budget: 206,250 ADA

Institutional Research & Interviews (Sundial): 45,000 ADA

UX Requirement Mapping & Compliance Needs (Fairway): 60,000 ADA

Project Management, Coordination & Early Development Scoping (Fairway): 101,250 ADA

Milestone 2: Frontend Shell & Balius Runtime Setup (Month 2)

Budget: 123,750 ADA

UI Shell & Routing Implementation (Fairway): 25,000 ADA

Balius Runtime Setup for Headless Protocol Integration (Partner: (likely SundaeLabs)): 45,000 ADA

Adapter Stubs for Lending/DEX (Partners: SundaeLabs, FluidTokens): 30,000 ADA

Balius UX Coordination & Integration Oversight (Sundial): 23,750 ADA

Milestone 3: Identity UX Integration (Month 3)

Budget: 123,750 ADA

Identity Center UI & Credential Status Display (Fairway): 30,000 ADA

Wallet Flow with KYC Prompting & Status (Fairway): 20,000 ADA

Identity Access Control SDK Integration with Balius (Fairway): 35,000 ADA

Identity credential integration coordination with FluidTokens: 38,750 ADA

Milestone 4: Smart Contract Upgrades & Identity Enforcement (Month 4)

Budget: 123,750 ADA

Lending Contract Upgrade (FluidTokens): 25,000 ADA

DEX Contract Upgrade (Partner: (likely SundaeLabs)): 28,750 ADA

Smart Contract Re-Audits (Distributed: 20k (Partner: (likely SundaeLabs), 20k FluidTokens): 40,000 ADA

Identity Gating Integration Testing (Fairway): 30,000 ADA

Milestone 5: BTC UX + Aquarium (Babel Fees) Integration (Month 5)

Budget: 123,750 ADA

Aquarium Integration (Fee Payment in any asset) (FluidTokens): 40,000 ADA

Simulated BTC Wallet UX + Mock Routing Flows (Sundial 10K + Fairway 10K): 20,000 ADA

Bridging Flow Simulation (Sundial): 25,750 ADA

Institutional Feedback, Testing, & Refinement (Sundial): 38,000 ADA

Milestone 6: Mainnet Launch & Open Integration Framework (Month 6)

Budget: 123,750 ADA

Mainnet Deployment & Hosting (Sundial): 30,000 ADA

Public SDKs & Docs (Fairway): 25,000 ADA

Developer Onboarding Materials & Guides (FluidTokens): 28,750 ADA

Launch Testing & Marketing Support (Fairway): 20,000 ADA

Institutional Partner Onboarding Coordination (Sundial): 20,000 ADA

[Final Pitch] Value for Money

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

This project delivers high strategic value to the Cardano ecosystem by solving some of the most pressing challenges holding back institutional and retail adoption: compliance, onboarding, and real-world usability.

Instead of building just another dApp, this proposal creates a flexible, reusable platform for launching regulated, user-friendly DeFi products that are powered by Cardano infrastructure and protocols.

1. Institutional Readiness at a Critical Time

With Bitcoin-native DeFi launching through Sundial, and regulatory pressure rising globally, Cardano needs to offer institutions a clear, trusted path to deliver crypto products. This project meets that moment.

It gives institutions and builders the tools to:

• Launch DeFi apps with built-in KYC and access control

• Meet regulatory requirements without compromising on decentralization

• Offer Bitcoin-based lending, trading, or borrowing through a unified interface

• Tap into Cardano’s DeFi ecosystem without needing deep on-chain expertise

This is the infrastructure required to turn Cardano into a real platform for financial services, not just a network of protocols.

2. Reusable Architecture, Shared Benefits

• DeFi protocols plug into a common backend (via Balius), making them instantly usable by any frontend or app that adopts the framework.

• Identity and access layers are modular and reusable, saving all future projects from rebuilding compliance infrastructure.

• Builders can fork, configure, and deploy branded financial apps using this stack — shortening development time and cost.

3. Ecosystem-Wide Developer Enablement

• The toolkit lowers the barrier to entry for developers and startups looking to build on Cardano.

• With clear UX, identity support, and ready integrations, it turns Cardano DeFi into a product platform, not just an app layer.

• Enables apps that target specific markets, regulatory environments, or product niches.

4. Delivered by Proven Builders

• Each team — Sundial, Fairway, FluidTokens — is responsible for a clearly scoped part of the stack, with deep experience in their respective domains.

• Roles are divided between protocol development, UX, identity, infrastructure, and institutional engagement.

• Work is structured around practical deliverables with tested deployment on Cardano mainnet.

5. Long-Term Impact, Open Adoption

• Once live, this system can be adopted by any Cardano DeFi protocol — or any team looking to launch a regulated crypto product.

• It will be open-source, modular, and maintained, making it a long-term asset for the ecosystem.

• Future Catalyst proposals or independent builders can extend this framework without needing new foundational investment.

6. Measurable Results

• A full product will be delivered to mainnet, with at least one protocol (Sundae or Fluid) live at launch.

• Includes documentation, developer guides, and testnet templates.

• Supports real Bitcoin onboarding in the future via Sundial and Babel fee flows — connecting the biggest crypto asset to real Cardano-based DeFi products.

[Required Acknowledgements] Consent & Confirmation

Terms and Conditions:

Yes