diff --git a/protos/src/main/protobuf/blockstream.proto b/protos/src/main/protobuf/blockstream.proto
index 942be6f5..e1207e38 100644
--- a/protos/src/main/protobuf/blockstream.proto
+++ b/protos/src/main/protobuf/blockstream.proto
@@ -31,7 +31,11 @@ message PublishStreamRequest {
 }
 
 message PublishStreamResponse {
-    uint64 block_number = 1;
+    ItemAcknowledgement acknowledgement = 1;
+}
+
+message ItemAcknowledgement {
+    bytes item_ack = 1;
 }
 
 message SubscribeStreamRequest {
@@ -40,6 +44,7 @@ message SubscribeStreamRequest {
 
 message SubscribeStreamResponse {
     int32 status = 1;
+    BlockItem block_item = 2;
 }
 
 /**
@@ -51,7 +56,5 @@ message BlockItem {
 
     int64 block_header = 1;
 
-    uint64 id = 2;
-
-    string value = 3;
+    string value = 2;
 }
diff --git a/server/src/main/java/com/hedera/block/server/BlockStreamService.java b/server/src/main/java/com/hedera/block/server/BlockStreamService.java
index cf1798ab..8603ce64 100644
--- a/server/src/main/java/com/hedera/block/server/BlockStreamService.java
+++ b/server/src/main/java/com/hedera/block/server/BlockStreamService.java
@@ -20,6 +20,7 @@
 import static com.hedera.block.protos.BlockStreamService.PublishStreamRequest;
 import static com.hedera.block.protos.BlockStreamService.PublishStreamResponse;
 import static com.hedera.block.protos.BlockStreamService.SubscribeStreamRequest;
+import static com.hedera.block.protos.BlockStreamService.SubscribeStreamResponse;
 import static com.hedera.block.server.Constants.*;
 
 import com.google.protobuf.Descriptors;
@@ -101,7 +102,7 @@ private StreamObserver<PublishStreamRequest> publishBlockStream(
     }
 
     private StreamObserver<SubscribeStreamRequest> subscribeBlockStream(
-            final StreamObserver<BlockItem> subscribeStreamRequestObserver) {
+            final StreamObserver<SubscribeStreamResponse> subscribeStreamRequestObserver) {
         LOGGER.log(System.Logger.Level.DEBUG, "Executing bidirectional streamSource method");
 
         // Return a custom StreamObserver to handle streaming blocks from the producer.
diff --git a/server/src/main/java/com/hedera/block/server/consumer/ConsumerBlockItemObserver.java b/server/src/main/java/com/hedera/block/server/consumer/ConsumerBlockItemObserver.java
index d32824ca..26317258 100644
--- a/server/src/main/java/com/hedera/block/server/consumer/ConsumerBlockItemObserver.java
+++ b/server/src/main/java/com/hedera/block/server/consumer/ConsumerBlockItemObserver.java
@@ -18,7 +18,10 @@
 
 import static com.hedera.block.protos.BlockStreamService.BlockItem;
 import static com.hedera.block.protos.BlockStreamService.SubscribeStreamRequest;
+import static com.hedera.block.protos.BlockStreamService.SubscribeStreamResponse;
 
+import com.google.protobuf.Descriptors;
+import com.hedera.block.protos.BlockStreamService;
 import com.hedera.block.server.data.ObjectEvent;
 import com.hedera.block.server.mediator.StreamMediator;
 import io.grpc.stub.ServerCallStreamObserver;
@@ -37,7 +40,7 @@ public class ConsumerBlockItemObserver
 
     private final System.Logger LOGGER = System.getLogger(getClass().getName());
 
-    private final StreamObserver<BlockItem> subscribeStreamResponseObserver;
+    private final StreamObserver<BlockStreamService.SubscribeStreamResponse> subscribeStreamResponseObserver;
 
     private final long timeoutThresholdMillis;
     private final InstantSource producerLivenessClock;
@@ -58,7 +61,7 @@ public ConsumerBlockItemObserver(
             final long timeoutThresholdMillis,
             final InstantSource producerLivenessClock,
             final StreamMediator<ObjectEvent<BlockItem>, SubscribeStreamRequest> streamMediator,
-            final StreamObserver<BlockItem> subscribeStreamResponseObserver) {
+            final StreamObserver<SubscribeStreamResponse> subscribeStreamResponseObserver) {
 
         this.timeoutThresholdMillis = timeoutThresholdMillis;
         this.producerLivenessClock = producerLivenessClock;
@@ -72,7 +75,7 @@ public ConsumerBlockItemObserver(
             // Unfortunately we have to cast the responseStreamObserver to a
             // ServerCallStreamObserver
             // to register the onCancelHandler.
-            ((ServerCallStreamObserver<BlockItem>) subscribeStreamResponseObserver)
+            ((ServerCallStreamObserver<SubscribeStreamResponse>) subscribeStreamResponseObserver)
                     .setOnCancelHandler(
                             () -> {
                                 LOGGER.log(
@@ -102,7 +105,12 @@ public void onEvent(final ObjectEvent<BlockItem> event, final long l, final bool
         }
 
         if (isReachedFirstBlock) {
-            subscribeStreamResponseObserver.onNext(blockItem);
+            SubscribeStreamResponse subscribeStreamResponse = SubscribeStreamResponse
+                    .newBuilder()
+                    .setBlockItem(blockItem)
+                    .build();
+
+            subscribeStreamResponseObserver.onNext(subscribeStreamResponse);
         }
     }
 
diff --git a/server/src/main/java/com/hedera/block/server/mediator/LiveStreamMediatorImpl.java b/server/src/main/java/com/hedera/block/server/mediator/LiveStreamMediatorImpl.java
index 08d7ae90..4484b203 100644
--- a/server/src/main/java/com/hedera/block/server/mediator/LiveStreamMediatorImpl.java
+++ b/server/src/main/java/com/hedera/block/server/mediator/LiveStreamMediatorImpl.java
@@ -73,7 +73,7 @@ public LiveStreamMediatorImpl(
     public void publishEvent(BlockItem blockItem) {
 
         // Publish the block for all subscribers to receive
-        LOGGER.log(System.Logger.Level.INFO, "Publishing block: {0}", blockItem);
+        LOGGER.log(System.Logger.Level.INFO, "Publishing BlockItem: {0}", blockItem);
         ringBuffer.publishEvent((event, sequence) -> event.set(blockItem));
 
         // Block persistence
diff --git a/server/src/main/java/com/hedera/block/server/persistence/WriteThroughCacheHandler.java b/server/src/main/java/com/hedera/block/server/persistence/WriteThroughCacheHandler.java
index 0298431b..5f661b68 100644
--- a/server/src/main/java/com/hedera/block/server/persistence/WriteThroughCacheHandler.java
+++ b/server/src/main/java/com/hedera/block/server/persistence/WriteThroughCacheHandler.java
@@ -51,7 +51,7 @@ public Long persist(final BlockItem blockItem) {
 
         // Write-Through cache
         blockStorage.write(blockItem);
-        return blockItem.getId();
+        return blockItem.getBlockHeader();
     }
 
     /**
diff --git a/server/src/main/java/com/hedera/block/server/persistence/storage/FileSystemBlockStorage.java b/server/src/main/java/com/hedera/block/server/persistence/storage/FileSystemBlockStorage.java
index e07f789c..a07fe79a 100644
--- a/server/src/main/java/com/hedera/block/server/persistence/storage/FileSystemBlockStorage.java
+++ b/server/src/main/java/com/hedera/block/server/persistence/storage/FileSystemBlockStorage.java
@@ -81,7 +81,7 @@ public FileSystemBlockStorage(final String key, final Config config) throws IOEx
      */
     @Override
     public Optional<Long> write(final BlockItem blockItem) {
-        Long id = blockItem.getId();
+        Long id = blockItem.getBlockHeader();
         final String fullPath = resolvePath(id);
 
         try (FileOutputStream fos = new FileOutputStream(fullPath)) {
diff --git a/server/src/main/java/com/hedera/block/server/producer/ProducerBlockItemObserver.java b/server/src/main/java/com/hedera/block/server/producer/ProducerBlockItemObserver.java
index 8460dcb6..51dddc25 100644
--- a/server/src/main/java/com/hedera/block/server/producer/ProducerBlockItemObserver.java
+++ b/server/src/main/java/com/hedera/block/server/producer/ProducerBlockItemObserver.java
@@ -16,15 +16,19 @@
 
 package com.hedera.block.server.producer;
 
-import static com.hedera.block.protos.BlockStreamService.BlockItem;
-import static com.hedera.block.protos.BlockStreamService.PublishStreamRequest;
-import static com.hedera.block.protos.BlockStreamService.PublishStreamResponse;
-import static com.hedera.block.protos.BlockStreamService.SubscribeStreamRequest;
-
+import com.google.protobuf.ByteString;
 import com.hedera.block.server.data.ObjectEvent;
 import com.hedera.block.server.mediator.StreamMediator;
 import io.grpc.stub.StreamObserver;
 
+import java.io.ByteArrayOutputStream;
+import java.io.IOException;
+import java.io.ObjectOutputStream;
+import java.security.MessageDigest;
+import java.security.NoSuchAlgorithmException;
+
+import static com.hedera.block.protos.BlockStreamService.*;
+
 /**
  * The ProducerBlockStreamObserver class plugs into Helidon's server-initiated bidirectional gRPC
  * service implementation. Helidon calls methods on this class as networking events occur with the
@@ -57,13 +61,24 @@ public ProducerBlockItemObserver(
     @Override
     public void onNext(final PublishStreamRequest publishStreamRequest) {
 
-        BlockItem blockItem = publishStreamRequest.getBlockItem();
+        final BlockItem blockItem = publishStreamRequest.getBlockItem();
         streamMediator.publishEvent(blockItem);
 
-        // Send a response back to the upstream producer
-        final PublishStreamResponse publishStreamResponse =
-                PublishStreamResponse.newBuilder().setBlockNumber(blockItem.getId()).build();
-        publishStreamResponseObserver.onNext(publishStreamResponse);
+        try {
+            // Send a response back to the upstream producer
+            // TODO: Use real hash
+            final ItemAcknowledgement itemAck =
+                    ItemAcknowledgement.newBuilder()
+                            .setItemAck(ByteString.copyFrom(getFakeHash(blockItem)))
+                            .build();
+            final PublishStreamResponse publishStreamResponse =
+                    PublishStreamResponse.newBuilder()
+                            .setAcknowledgement(itemAck)
+                            .build();
+            publishStreamResponseObserver.onNext(publishStreamResponse);
+        } catch (IOException | NoSuchAlgorithmException e) {
+            LOGGER.log(System.Logger.Level.ERROR, "Error calculating hash", e);
+        }
     }
 
     /**
@@ -87,4 +102,18 @@ public void onCompleted() {
         LOGGER.log(System.Logger.Level.DEBUG, "ProducerBlockStreamObserver completed");
         publishStreamResponseObserver.onCompleted();
     }
+
+    private static byte[] getFakeHash(BlockItem blockItem) throws IOException, NoSuchAlgorithmException {
+        ByteArrayOutputStream byteArrayOutputStream = new ByteArrayOutputStream();
+        try (ObjectOutputStream objectOutputStream = new ObjectOutputStream(byteArrayOutputStream)) {
+            objectOutputStream.writeObject(blockItem);
+        }
+
+        // Get the serialized bytes
+        byte[] serializedObject = byteArrayOutputStream.toByteArray();
+
+        // Calculate the SHA-256 hash
+        MessageDigest digest = MessageDigest.getInstance("SHA-384");
+        return digest.digest(serializedObject);
+    }
 }
diff --git a/server/src/test/resources/producer.sh b/server/src/test/resources/producer.sh
index 8076ef94..a74621a5 100755
--- a/server/src/test/resources/producer.sh
+++ b/server/src/test/resources/producer.sh
@@ -49,19 +49,17 @@ trap cleanup SIGINT
     do
 
       if [[ i -eq 1 ]]; then
-        echo "{\"block_item\": {\"block_header\": $iter,\"id\": $i,\"value\": \"Lorem ipsum dolor sit amet\"}}"
+        echo "{\"block_item\": {\"block_header\": $iter,\"value\": \"Payload[...]\"}}"
       else
-        echo "{\"block_item\": {\"block_header\": -1,\"id\": $i,\"value\": \"est dolor nulla\"}}"
-      fi
-
-
-      if [ $iter -eq $2 ]; then
-        exit 0
+        echo "{\"block_item\": {\"block_header\": 0,\"value\": \"Payload[...]\"}}"
       fi
 
       sleep 0.5
     done
 
+    if [ $iter -eq $2 ]; then
+      exit 0
+    fi
     ((iter++))
 
   done