# Custody Architecture

Custody in Bits maintains a direct link to Bitcoin, avoiding derivative strategies or asset reuse. All collateral is transparent, auditable, and recoverable via on-chain rules.

* Native BTC Vaults: Deposits on the Bitcoin mainnet are held in time-locked or secure vault addresses, with clear proof of reserves for visibility.
* Smart Contract Custody for Wrapped Assets: Tokens like wBTC and cbBTC are stored in audited smart contracts, where minting and redemption follow immutable code.
* Multichain Orchestration: The orchestrator verifies deposits and redemptions across chains, issuing tokens only after collateral confirmation and ensuring burned tokens release the equivalent BTC.

This structure enforces 1:1 collateralization for all BITS tokens, combining Bitcoin's security with audited processes and proof-of-reserves to build user confidence in yield-bearing BTC staking.

<br>


---

# Agent Instructions: Querying This Documentation

If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://docs.bits.financial/protocol-overview/custody-architecture.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.