> For the complete documentation index, see [llms.txt](https://docs.bima.money/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.bima.money/operations-and-governance/risk-disclosures.md).

# Risk Disclosures

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Read this page before depositing. Nothing in this documentation is investment, tax or legal advice. You can lose money.
{% endhint %}

## Market

**Downside is bounded, not removed.** The collar's put strike limits how far your loss can go. It does not protect the fall between your deposit price and that strike, which remains entirely yours.

**Upside above the call strike is forgone.** If Bitcoin runs far past the call strike within your term, you will have done better holding it unencumbered. This is the central trade of the product.

**You cannot react to the market.** No stop-loss, no de-risking, no exit. If your view changes in month three, you act in month twelve.

**Strike levels reflect one day's conditions.** Your strikes are set when your vault's window closes. A vault priced a month later may carry materially better or worse levels.

## Liquidity and lock-up

**Your BTC is committed for twelve months.** There is no early withdrawal for any reason not emergencies, not better opportunities, not a change of mind.

**Redemption is not instant.** Collateral is released after collar settlement and a 7–15 day redemption window, not on the day you repay.

**Missing the deposit window costs a month.** Windows are seven days. A failed transaction on day seven means waiting for the next vault, at different strikes.

## Repayment

**You must have USDC at maturity.** The obligation is fixed and known from the day you claim.

**Non-repayment means non-redemption.** Collateral is released against repayment. Full non-repayment terms will be published at [Repayment and Redemption](file:///8003494/vault/lifecycle/repayment-and-redemption.md) before the first vault matures.

## Counterparty and structural

**Collateral is held off-chain under the collar.** For most of the term it sits with FalconX, not in the vault contract. You are relying on that counterparty, on Accountable's vault infrastructure, and on BIMA's operational processes not solely on code.

**Counterparty failure is possible.** Institutional counterparties can fail, be sanctioned, or become unable to return assets.

**Collar settlement depends on off-chain processes.** Settlement and redemption approvals run through BIMA. Failure or delay at that layer could affect when and what you receive.

**Settlement mechanics are not yet fully published.** Precise treatment in each zone will be published before the first vault matures. Do not deposit assuming a specific mechanic that has not been documented.

## Asset

**Tokenised BTC is not Bitcoin.** WBTC, cbBTC and similar tokens depend on their issuers and custodians. If backing is lost, the token can trade below Bitcoin regardless of the BTC price. You redeem the same asset you deposited.

**USDC carries issuer risk.** The USDC you borrow and repay depends on its issuer maintaining backing and redeemability. A depeg would affect both what you hold and what you must repay.

## Technology

**Smart contract risk.** Flaws in the vault could result in loss of funds, whether or not it has been audited.

**Chain and infrastructure risk.** Congestion, outages or reorganisations can affect your ability to transact at a specific moment including on the last day of a deposit or redemption window.

**Wallet and phishing risk.** Fake addresses and fraudulent front-ends are the most common cause of loss. See [Contract Addresses](broken://pages/fa944250abdd37558dc12146c4e1a735e5c01d88).

## Regulatory and tax

**Treatment varies.** Whether this arrangement constitutes a disposal, how it is accounted for and how it is taxed depend on your jurisdiction and circumstances. Take your own advice.

**Rules are changing.** Digital asset lending, custody and derivatives regulation continues to develop and may affect availability or terms.

**Availability is restricted.** The product is not available in all jurisdictions or to all persons.

## What this product does not do

* It does not guarantee your capital
* It does not remove market exposure it bounds it
* It does not give you the best outcome in a strong bull market
* It does not give you access to your BTC or your capital during the term
* It does not remove counterparty risk it relocates it to a named institution