Primary-Source Explanation

What Are Provenance-Backed Securities (PBS)?

Provenance-Backed Securities are a proposed framework for connecting documented intangible contributions with independently measurable performance and economic ownership.

What are Provenance-Backed Securities?

Provenance-Backed Securities, or PBS, are a proposed class of financial instruments designed to connect documented authorship, contribution, or ownership of an intangible asset with independently verifiable performance information and economic rights.

The central idea is that provenance answers who created or contributed what, performance measurement answers how the asset performs, and market infrastructure provides a mechanism for determining and exchanging economic value.

What problem is PBS intended to address?

Modern economic value increasingly includes intangible assets such as intellectual property, data, expertise, algorithms, research, creative works, and genetic innovation.

PBS proposes infrastructure for documenting contribution and provenance, measuring real-world performance, and associating economic rights with those contributions.

How does the PBS architecture work?

The PBS technical framework is organized around three principal components.

Layer 1

Provenance Ledger

Establishes a verifiable record describing the asset, contribution history, and ownership chain.

Layer 2

Performance Oracle

Connects an asset to independently measurable real-world performance information relevant to its economic value.

Layer 3

Exchange Protocol

Provides proposed infrastructure for listing, pricing, transferring, settling, and auditing PBS instruments.

Regulatory Status

Is PBS currently a recognized securities category?

PBS is a proposed architecture rather than an established statutory securities category.

ScarabCloud engaged the Washington State Department of Financial Institutions regarding PBS/MPS. DFI advised that the architecture described in the submitted materials extends beyond the laws administered by DFI and could implicate multiple areas of law. DFI also stated that existing state and federal securities-law requirements would apply where an implementation involves the offer or sale of securities.

DFI does not endorse ScarabCloud, PBS/MPS, SeedBid™, or the proposed legislation. Regulatory classification depends on the facts and structure of an actual implementation.

Agricultural Implementation

What is SeedBid™?

SeedBid™ is the proposed agricultural implementation of the PBS architecture. SeedBid™ applies provenance documentation and performance measurement to