xxB-2025-002: Sleeve Wallet Single Seed Modification

Grants and Bounties
1

Bounty XXB-2025-002: Sleeve Wallet Single Seed Modification

Overview

This bounty rewards developers for modifying the Sleeve Wallet to support single seed phrase generation while maintaining quantum security through WOTS (Winternitz One-Time Signature) and classical ECDSA key binding.

The current generation is described here: wallet/docs/Sleeve Wallet generation.png · main · foundation / sleeve · GitLab - This produces a quantum secure secret and an output used to generate a BIP39 mnemonic used as a seed for other wallets. This construction necessitates 2 output mnemonics. One based on entropy to create a wallet secret to generate a WOTS keypair and one based on the SHA3_256 output which generates the ECDSA key. Sleeve derives it’s security by chaining the public key from WOTS to the secret that generates the ECDSA or other key type, allowing for support of any arbitrary network. We want to add an option to use a single seed phrase and generate such keys using the WOTS public key as part of the derivation path. The goal here is to modify the sleeve tool to produce both types, as BIP32 derivation and related do not typically expose the master key, only the secret keys attached to the public key. Thus, by using the same seed to produce a bound quantum and classical key, users can generate such keys with existing seeds instead of relying on 2 levels of BIP32. You can implement this via separate derivation path or by selecting an index value that corresponds to the WOTS public key.

Technical Resources

Prize Pool & Award Notes/Restrictions

  • Total Prize: ~$50,000 USD in xx equivalent
  • Total determined by token average over 2 week period after milestone submission.
  • Token lockups may be required depending on your proposal/submission.
  • KYC may be required.

Milestone 1 (70%): Sleeve Tool Core Modification

  • Modify the current Sleeve Wallet generation process (wallet/docs/Sleeve Wallet generation.png · main · foundation / sleeve · GitLab)
  • Implement single seed phrase option alongside existing dual-mnemonic approach
  • Maintain quantum security by using WOTS public key as part of derivation path
  • Support both separate derivation path implementation and index value selection corresponding to WOTS public key
  • Ensure backward compatibility with existing dual-mnemonic generation
  • Maintain security model where WOTS public key chains to the secret generating ECDSA keys
  • Enable arbitrary network support through bound quantum and classical key generation

Implementation Specifications

  • Single seed phrase must generate both quantum-secure WOTS keypair and classical ECDSA keys
  • WOTS public key must be incorporated into the derivation path for classical key generation
  • BIP32 derivation compatibility while exposing necessary key material for quantum security
  • Support for existing seed phrases to generate bound quantum and classical keys
  • Clear separation between single-seed and dual-mnemonic generation modes

Milestone 2 (20%): Existing Tool Integration

Milestone 3 (10%): External Audit

Reserved for auditor.

Other Submission Requirements

  1. Source Code Requirements:

    • Open source (same license as existing Sleeve components)
    • Submitted via merge request to appropriate repositories
    • Well-documented with inline comments
    • Passing comprehensive test suite
    • Following project coding standards
    • Backward compatibility maintained

  2. Documentation Requirements:

    • Technical specification of single seed implementation
    • API reference documentation
    • User guide for both generation methods
    • Security analysis and threat model
    • Migration guide from dual-mnemonic to single seed
    • Build and deployment instructions

  3. Testing Requirements:

    • Unit tests for all new functionality
    • Integration tests for web and desktop interfaces
    • Security tests validating quantum-classical key binding
    • Compatibility tests with existing wallets
    • Performance benchmarks
2

Good evening,

I’d like to propose our involvement with the development of Bounty XXB-2025-002: Sleeve Wallet Single Seed Modification.

As some of you might have been following our progress on the extension milestone (which is now being audited), I’d love to continue our mutual efforts. As per previous conversations with @rick regarding the details, I’d also like to formally propose them for the council.

We would like to include a few changes and clarifications to the original grant:

Milestone 0 (20%)

  • technical design document (diagram/flow based) that confirms all the technical specifications before it’s implementation

Milestone 1(20%)

  • Modify current sleeve generation process to allow option for single seed phrase option.

Milestone 2 (20%)

  • Perform thorough tests on the modification to ensure security models maintained and is still fully quantum secure, check backwards compatibility for dual seed phrase generation and ensure both types of wallet generation (single and dual) work on any other arbitrary network. Tests should demonstrate all core functionality as specified in the bounty proposal.

Milestone 3 (30%)

  • Integrate modifications into the XX Network wallet generator UI and the sleeve generator tool. Writeup information for users to utilize new features and for developers to maintain in the future.

Milestone 4(10%)

  • Audit

General updates;

  • The core focus will be on the technical implementation, other points are secondary.
  • The specific wallet integrations will be confirmed with Rick ahead of commencement

Payout details

  • 60% of the rewarded grant direct release, 40% over a 3 month vesting shedule
  • All payouts are calculated from USD (50 000USD)
    • USD to xx calculation: follows either a 2 week moving average or the current lowest price, where the grant receivers (us) receive the optimal rate.
    • Milestone submission post is seen as the payout calculation date
  • If there is a major vesting change in token price, this wil be pro-rated with the next milestone, or on a near future payout
  • Liquidity guarantee when exiting from xx to USD on the tokens

Background on myself & Evi
mf: https://michiel.degruytere.com/
evi: Tranquil-Flow (Evi Nova) · GitHub (More links are restricted due to forum policy; all 3rd party social links can be found on our websites, or requested)

Excited to hear back from xx, and open for discussion!

Talk soon,
Mf

1 Like
3

Hi Mf,

This proposal looks acceptable to us with no changes. Would you prefer pegging to EUR? If so, we can do 45,000 EUR.

thanks,

Foundation Team

4

Hi Foundation,

It would be great to have it pegged to EUR, and that consideration is appreciated.
We’ve begun our work in the meantime and will soon get back with the initial architecture.

-mf

5

Curator proposed and sent to council: 0x3e7ed5d24d36b5a08ba39bf21cdf6d66fca54122b0fd13fd71f397741ad1505f

Screenshot 2025-08-29 at 11.53.11
Screenshot 2025-08-29 at 11.53.112208×834 41.1 KB

1 Like