diff --git a/CHANGELOG.md b/CHANGELOG.md
deleted file mode 100644
--- a/CHANGELOG.md
+++ /dev/null
@@ -1,7 +0,0 @@
-# Changelog
-
-## 0.1.0 (2018-01-17)
-
-Initial release
-
-* Exchange text messages with Magic Wormhole peers
diff --git a/LICENSE b/LICENSE
--- a/LICENSE
+++ b/LICENSE
@@ -1,163 +1,202 @@
-Apache License
 
-Version 2.0, January 2004
+                                 Apache License
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-http://www.apache.org/licenses/
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diff --git a/Setup.hs b/Setup.hs
new file mode 100644
--- /dev/null
+++ b/Setup.hs
@@ -0,0 +1,2 @@
+import Distribution.Simple
+main = defaultMain
diff --git a/cmd/HocusPocus.hs b/cmd/HocusPocus.hs
--- a/cmd/HocusPocus.hs
+++ b/cmd/HocusPocus.hs
@@ -87,7 +87,9 @@
         MagicWormhole.PlainText received <- atomically $ MagicWormhole.receiveMessage conn
         case Aeson.eitherDecode (toS received) of
           Left err -> panic $ "Could not decode message: " <> show err
-          Right (MagicWormhole.Message message) -> pure message)
+          Right (MagicWormhole.Message message) -> pure message
+          Right (MagicWormhole.File _ _) -> pure $ "File transfer is not supported"
+          Right (MagicWormhole.Directory _ _ _ _ _) -> pure $ "Directory transfer is not supported")
 
 -- | Bounce a trivial message to and from a Rendezvous server.
 bounce :: MagicWormhole.WebSocketEndpoint -> MagicWormhole.AppID -> IO ()
@@ -114,6 +116,8 @@
       case Aeson.eitherDecode (toS received) of
         Left err -> panic $ "Could not decode message: " <> show err
         Right (MagicWormhole.Message message) -> pure message
+        Right (MagicWormhole.File _ _) -> pure $ "File transfer is not supported"
+        Right (MagicWormhole.Directory _ _ _ _ _) -> pure $ "Directory transfer is not supported"
 
     password = Spake2.makePassword "potato"
 
diff --git a/magic-wormhole.cabal b/magic-wormhole.cabal
--- a/magic-wormhole.cabal
+++ b/magic-wormhole.cabal
@@ -1,32 +1,27 @@
--- This file has been generated from package.yaml by hpack version 0.17.1.
+-- This file has been generated from package.yaml by hpack version 0.28.2.
 --
 -- see: https://github.com/sol/hpack
+--
+-- hash: 70e0d0470150c88f241234f7c12f2f2e92a2dcc939f84e6da5db4c8ba17a06a5
 
 name:           magic-wormhole
-version:        0.1.0
+version:        0.2.0
 synopsis:       Interact with Magic Wormhole
-description:    Client library for interacting with a Magic Wormhole server.
-                .
-                Magic Wormhole is a technology for getting things from one computer to another, safely.
-                It does this by using a server to locate peers, and then using SPAKE2 encryption to
-                negotiate a secure connection to a peer. It is especially useful for sending files
-                and short messages to other humans.
+description:    Magic Wormhole is a scheme to get things from one computer to another,
+                safely.
                 .
-                You can learn more about Magic Wormhole by exploring the documentation on
-                the [canonical, Python
-                implementation](https://github.com/warner/magic-wormhole).
+                This is a library for client-side interactions with a Magic Wormhole server.
 category:       Crypto
-homepage:       https://github.com/LeastAuthority/haskell-magic-wormhole#readme
-bug-reports:    https://github.com/LeastAuthority/haskell-magic-wormhole/issues
-maintainer:     Jonathan M. Lange <jml@mumak.net>
+homepage:       https://github.com/leastauthority/haskell-magic-wormhole#readme
+bug-reports:    https://github.com/leastauthority/haskell-magic-wormhole/issues
+author:         Jonathan M. Lange <jml@mumak.net>,
+                Ramakrishnan Muthukrishnan <ram@leastauthority.com>,
+                Jean-Paul Calderone <jean-paul@leastauthority.com>
+maintainer:     Least Authority TFA GmbH
 license:        Apache
 license-file:   LICENSE
 build-type:     Simple
 cabal-version:  >= 1.10
-
-extra-source-files:
-    CHANGELOG.md
-
 data-files:
     tests/python/derive_phase_key.py
     tests/python/nacl_exchange.py
@@ -35,18 +30,16 @@
 
 source-repository head
   type: git
-  location: https://github.com/LeastAuthority/haskell-magic-wormhole
+  location: https://github.com/leastauthority/haskell-magic-wormhole
 
 library
   hs-source-dirs:
       src
   default-extensions: NoImplicitPrelude OverloadedStrings TypeApplications
-  ghc-options: -Wall
+  ghc-options: -Wall -Werror=incomplete-patterns
   build-depends:
-      base >= 4.9 && < 5
-    , protolude >= 0.2
-    , spake2 >= 0.4.1
-    , aeson
+      aeson
+    , base ==4.9.*
     , bytestring
     , containers
     , cryptonite
@@ -55,10 +48,12 @@
     , network
     , network-uri
     , pqueue
+    , protolude >=0.2
     , saltine
+    , spake2 >=0.4
     , stm
     , unordered-containers
-    , websockets
+    , websockets >=0.8.0.0
   exposed-modules:
       MagicWormhole
       MagicWormhole.Internal.ClientProtocol
@@ -70,21 +65,25 @@
       MagicWormhole.Internal.Sequential
       MagicWormhole.Internal.Versions
       MagicWormhole.Internal.WebSockets
+  other-modules:
+      Paths_magic_wormhole
   default-language: Haskell2010
 
 executable hocus-pocus
   main-is: HocusPocus.hs
+  other-modules:
+      Paths_magic_wormhole
   hs-source-dirs:
       cmd
   default-extensions: NoImplicitPrelude OverloadedStrings TypeApplications
-  ghc-options: -Wall
+  ghc-options: -Wall -Werror=incomplete-patterns
   build-depends:
-      base >= 4.9 && < 5
-    , protolude >= 0.2
-    , spake2 >= 0.4.1
-    , aeson
+      aeson
+    , base ==4.9.*
     , magic-wormhole
     , optparse-applicative
+    , protolude >=0.2
+    , spake2 >=0.4
     , text
   default-language: Haskell2010
 
@@ -94,28 +93,30 @@
   hs-source-dirs:
       tests
   default-extensions: NoImplicitPrelude OverloadedStrings TypeApplications
-  ghc-options: -Wall
+  ghc-options: -Wall -Werror=incomplete-patterns
   build-depends:
-      base >= 4.9 && < 5
-    , protolude >= 0.2
-    , spake2 >= 0.4.1
-    , aeson
+      aeson
+    , base ==4.9.*
     , bytestring
     , hedgehog
     , magic-wormhole
     , memory
     , process
+    , protolude >=0.2
     , saltine
+    , spake2 >=0.3
     , stm
     , tasty
     , tasty-hedgehog
     , tasty-hspec
   other-modules:
       ClientProtocol
+      FileTransfer
       Generator
       Integration
       Messages
       Pake
       Sequential
       WebSockets
+      Paths_magic_wormhole
   default-language: Haskell2010
diff --git a/src/MagicWormhole.hs b/src/MagicWormhole.hs
--- a/src/MagicWormhole.hs
+++ b/src/MagicWormhole.hs
@@ -59,6 +59,7 @@
   , Peer.withEncryptedConnection
   , ClientProtocol.Connection
   , Peer.EncryptedConnection
+  , Peer.deriveKey
     -- *** Errors
   , ClientProtocol.PeerError
   , Versions.VersionsError
@@ -75,6 +76,7 @@
     -- However, Magic Wormhole comes with at least one built-in "application": message and file transfer.
     -- This Haskell implementation only supports sending and receiving a simple message.
   , FileTransfer.Offer(..)
+  , FileTransfer.DirectoryMode(..)
   ) where
 
 import qualified MagicWormhole.Internal.ClientProtocol as ClientProtocol
diff --git a/src/MagicWormhole/Internal/FileTransfer.hs b/src/MagicWormhole/Internal/FileTransfer.hs
--- a/src/MagicWormhole/Internal/FileTransfer.hs
+++ b/src/MagicWormhole/Internal/FileTransfer.hs
@@ -8,6 +8,8 @@
 -- you can send an 'Offer' to share a simple text message.
 module MagicWormhole.Internal.FileTransfer
   ( Offer(..)
+  -- * for tests
+  , DirectoryMode(..)
   ) where
 
 import Protolude
@@ -19,20 +21,61 @@
   , (.=)
   , object
   , withObject
+  , Value( String )
   )
+import Data.Aeson.Types (typeMismatch)
+import System.Posix.Types (FileOffset)
+import Numeric.Natural (Natural)
 
 -- | An offer made by a sender as part of the Magic Wormhole file transfer protocol.
 --
 -- Currently only supports sending simple text messages. A full version would
 -- also support sending files and directories.
-newtype Offer
+data Offer
   -- | A simple text message.
-  = Message Text deriving (Eq, Show)
+  = Message Text
+  -- | Offer a File with filename and size.
+  | File FilePath FileOffset
+  -- | Offer a Directory
+  | Directory
+    { directoryMode :: DirectoryMode
+      -- ^ Mode. Currently always "zipfile/deflated".
+    , dirName :: Text
+      -- ^ Directory Name.
+    , zipSize :: Natural
+      -- ^ size of the transmitted compressed data in bytes
+    , numBytes :: Natural
+      -- ^ estimated total size of the uncompressed directory
+    , numFiles :: Natural
+      -- ^ number of files and directories being sent
+    } deriving (Eq, Show)
 
 instance ToJSON Offer where
   toJSON (Message text) = object [ "offer" .= object [ "message" .= text ] ]
+  toJSON (File name size) = object [ "offer" .= object [ "file" .= object [ "filename" .= name, "filesize" .= fromEnum size ] ] ]
+  toJSON (Directory mode dirname zipsize numbytes numfiles) = object [ "offer" .= object [ "directory" .= object [ "mode" .= mode, "dirname" .= dirname, "zipsize" .= zipsize, "numbytes" .= numbytes, "numfiles" .= numfiles ] ] ]
 
 instance FromJSON Offer where
   parseJSON = withObject "Offer" $ \obj -> do
     offer <- obj .: "offer"
-    Message <$> offer .: "message"
+    asum [ Message <$> offer .: "message"
+         , File
+           <$> ((offer .: "file") >>= (.: "filename"))
+           <*> (toEnum <$> ((offer .: "file") >>= (.: "filesize")))
+         , Directory
+           <$> ((offer .: "directory") >>= (.: "mode"))
+           <*> ((offer .: "directory") >>= (.: "dirname"))
+           <*> (toEnum <$> ((offer .: "directory") >>= (.: "zipsize")))
+           <*> (toEnum <$> ((offer .: "directory") >>= (.: "numbytes")))
+           <*> (toEnum <$> ((offer .: "directory") >>= (.: "numfiles")))
+         ]
+
+data DirectoryMode = ZipFileDeflated
+  deriving (Eq, Show)
+
+instance FromJSON DirectoryMode where
+  parseJSON (String s) | s == "zipfile/deflated" = return ZipFileDeflated
+  parseJSON o = typeMismatch "failed to parse Directory Mode" o
+
+instance ToJSON DirectoryMode where
+  toJSON ZipFileDeflated = String "zipfile/deflated"
diff --git a/src/MagicWormhole/Internal/Peer.hs b/src/MagicWormhole/Internal/Peer.hs
--- a/src/MagicWormhole/Internal/Peer.hs
+++ b/src/MagicWormhole/Internal/Peer.hs
@@ -7,6 +7,7 @@
   , withEncryptedConnection
   , sendMessage
   , receiveMessage
+  , deriveKey
   ) where
 
 import Protolude hiding (phase)
@@ -17,6 +18,7 @@
   , newTVar
   , readTVar
   )
+import qualified Crypto.Saltine.Core.SecretBox as SecretBox
 import qualified Crypto.Spake2 as Spake2
 
 import qualified MagicWormhole.Internal.ClientProtocol as ClientProtocol
@@ -64,7 +66,6 @@
   conn <- establishEncryption peer password
   runEncryptedConnection conn (action conn)
 
-
 -- | A Magic Wormhole peer-to-peer application session.
 --
 -- Construct one of these using 'withEncryptedConnection'.
@@ -146,3 +147,10 @@
 -- Obtain an 'EncryptedConnection' with 'withEncryptedConnection'.
 receiveMessage :: EncryptedConnection -> STM ClientProtocol.PlainText
 receiveMessage conn = snd <$> Sequential.next (inbound conn)
+
+
+-- | Derive a new key for the given purpose
+--
+-- Construct a new key from the encrypted connection's session key for the given purpose
+deriveKey :: EncryptedConnection -> ClientProtocol.Purpose -> SecretBox.Key
+deriveKey conn = ClientProtocol.deriveKey (sharedKey conn)
diff --git a/tests/FileTransfer.hs b/tests/FileTransfer.hs
new file mode 100644
--- /dev/null
+++ b/tests/FileTransfer.hs
@@ -0,0 +1,18 @@
+-- | Tests for serializing and deserializing FileTransfer messages
+module FileTransfer (tests) where
+
+import Protolude
+
+import Data.Aeson (encode, eitherDecode)
+import Hedgehog (forAll, property, tripping)
+import Test.Tasty (TestTree, testGroup)
+import Test.Tasty.Hedgehog (testProperty)
+
+import qualified Generator
+
+tests :: IO TestTree
+tests = pure $ testGroup "FileTransfer"
+  [ testProperty "offer messages roundtrip" $ property $ do
+      x <- forAll Generator.offerMessages
+      tripping x encode eitherDecode
+  ]
diff --git a/tests/Generator.hs b/tests/Generator.hs
--- a/tests/Generator.hs
+++ b/tests/Generator.hs
@@ -7,6 +7,7 @@
   , appIDs
   , phases
   , sides
+  , offerMessages
   ) where
 
 import Protolude
@@ -29,6 +30,10 @@
   , Mailbox(..)
   , Mood(..)
   )
+import qualified MagicWormhole.Internal.FileTransfer as F
+  ( Offer(..)
+  , DirectoryMode(..)
+  )
 
 clientMessages :: MonadGen m => m ClientMessage
 clientMessages = Gen.choice
@@ -97,3 +102,20 @@
 
 welcomeMessages :: MonadGen m => m WelcomeMessage
 welcomeMessages = WelcomeMessage <$> Gen.maybe (Gen.text (Range.linear 0 1024) Gen.unicode) <*> Gen.maybe (Gen.text (Range.linear 0 1024) Gen.unicode)
+
+directoryModes :: MonadGen m => m F.DirectoryMode
+directoryModes = Gen.choice
+  [ return F.ZipFileDeflated
+  ]
+
+offerMessages :: MonadGen m => m F.Offer
+offerMessages = Gen.choice
+  [ F.Message <$> (Gen.text (Range.linear 0 1024) Gen.unicode)
+  , F.File <$> toS <$> (Gen.text (Range.linear 0 100) Gen.unicode)  <*> (fromIntegral <$> (Gen.int (Range.linear 0 maxBound)))
+  , F.Directory
+    <$> directoryModes -- (toS <$> (Gen.text (Range.linear 0 100) Gen.unicode))
+    <*> (toS <$> (Gen.text (Range.linear 0 100) Gen.unicode))
+    <*> (fromIntegral <$> (Gen.int (Range.linear 0 maxBound)))
+    <*> (fromIntegral <$> (Gen.int (Range.linear 0 maxBound)))
+    <*> (fromIntegral <$> (Gen.int (Range.linear 0 maxBound)))
+  ]
diff --git a/tests/Tasty.hs b/tests/Tasty.hs
--- a/tests/Tasty.hs
+++ b/tests/Tasty.hs
@@ -9,6 +9,7 @@
 import qualified Messages
 import qualified Sequential
 import qualified WebSockets
+import qualified FileTransfer
 
 main :: IO ()
 main = sequence tests >>= defaultMain . testGroup "MagicWormhole"
@@ -16,6 +17,7 @@
     tests =
       [ ClientProtocol.tests
       , Messages.tests
+      , FileTransfer.tests
       , Sequential.tests
       , WebSockets.tests
         -- Put these at the end because they are slowest.
