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Flare can now verify stablecoin reserves without disclosure

2026-10-04 00:49:07
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Flare Network launches confidential computing feature on Songbird Network

@FlareNetworkshas has officially launched the Flare confidential computing (FCC) feature on Canary Network Songbird. This feature allows smart contracts to verify sensitive institutional data without exposing the underlying data to the chain. Currently, the first practical application is the reserve proof check of the USDX stablecoin issued by @Hex_Trust, making it the first stablecoin to adopt this technology.

How it works

The FCC aims to bridge the gap between public blockchain transparency and private agency data. It processes confidential input by processing within a registered trusted execution environment (TEE) and returns a signed result for the contract to verify before performing the operation.

TEE is a sealed hardware isolation area, which means that the computing process runs in isolation and raw data never appears on the chain. The machine generates its signature key within the quarantine area at startup. The key is retained in quarantine and the output is signed using the machine's registered identity. A verification contract checks the signature before other contracts store or use the results.

Flare launched the FCC on Songbird after the Internet accepted Proposal STP.13 in July 2026. The initial TEE machine used Google Cloud's confidential computing service and was operated by the Flare Foundation. It is expected that deployment will subsequently be carried out on the main network Flare.

USDX: Private reserves, public rulings

For USDX, Hex Trust provides reserve information from two sources: public reserve amounts and restricted cash reserve amounts. Flare Confidential Computing processes these two pieces of data in a trusted execution environment and checks the combined reserve amount against the amount of USDX circulating in the ecosystem.

The system does not upload these balance data, but instead signs and publishes a result showing whether USDX is supported 1:1 or better. The private data used to reach this conclusion remains undisclosed.

This result also plays a direct role in the Flare ecosystem. USDX is used as collateral for the FAssets system on the Songbird network, and its price oracle data is migrating to a new reserve-based reference system. Flare has previously processed public information through the Flare Time Series Oracle (FTSO) and the Flare Data Connector (FDC). However, institutional information such as reserve balances, fund net asset values, mortgage positions, credit data and compliance records is often not disclosed.

The FCC is designed to bridge this gap, and its application potential is expected to go far beyond the stablecoin reserve field.

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