How Cadena protects your Bitcoin
Cadena is built on a simple principle: no one should be able to take your Bitcoin — not Cadena, not a counterparty, not a failed price feed, not a platform outage.
This page explains how that holds up under pressure. Read the first few sections for the plain-language version. The links at the bottom go as deep as you want — open-source code, the on-chain proof, and a full security memo built for institutional risk teams.
The foundation: your Bitcoin never leaves a contract you can verify
When you use Cadena, your Bitcoin is committed to a Discreet Log Contract (DLC) on Bitcoin's base layer. Not a Cadena wallet. Not a pooled account. A contract on Bitcoin's blockchain that you can verify yourself.
This is the structural difference between Cadena and the lenders that failed in 2022. They held customer keys. Cadena never does.
The Oracle: how settlement price is determined
A Cadena contract settles at maturity based on the BTC/USD price. Something has to report that price. That something is the oracle — and because it matters, here is exactly how it works.
Cadena uses the DLCP Oracle. It is:
The oracle selects; it does not authorize. This is the key point. Every settlement outcome is already pre-signed before the oracle does anything. The oracle's only job at maturity is to point at which of the pre-signed transactions broadcasts. It cannot invent an outcome, refuse to settle, or move your Bitcoin.
What happens if the oracle fails?
If the oracle goes offline or fails to publish at maturity, a refund timelock path activates. After a defined window, a pre-signed refund transaction returns the Bitcoin to both parties — the lender's principal and the borrower's collateral go home. This path is enforced by Bitcoin script; it does not require Cadena's cooperation or the oracle's. A silent oracle cannot trap your Bitcoin.
For larger institutional contracts, Cadena's roadmap includes multi-oracle attestation (settlement contingent on 2-of-3 or 3-of-5 independent oracles), further reducing single-oracle risk.
No margin calls, no forced liquidations
A Cadena contract has no in-term liquidation mechanism. There is no margin call. There is no liquidation bot watching the price.
Settlement is a single event at maturity. During the term, the contract is locked — no party, including Cadena, can move the other party's Bitcoin or trigger an early settlement. Whatever Bitcoin does between funding and maturity, the outcome is decided once, at the end, by the pre-signed transaction matching the oracle's attested price.
For a borrower, this means no risk of being liquidated by a temporary price swing. For a lender, it means no path risk during the term — the outcome depends only on the price at maturity.
Gap risk, honestly
Cadena's contract pool is sized to cover the lender's full dollar-denominated target down to a 50% drop in Bitcoin's price between funding and maturity. That covers the overwhelming majority of historical scenarios.
If Bitcoin falls more than 50% over the contract term, the pool is no longer sufficient to cover the lender's full target — the lender absorbs the shortfall. This is gap risk, and we state it plainly rather than hide it. It is hedgeable: a lender can purchase a put option struck near the 50% threshold to cap the downside. The construction is detailed in the Security & Operations Memo linked below.
No Bitcoin credit product eliminates all risk. Cadena's design eliminates custody risk, counterparty-discretion risk, rehypothecation risk, and margin-call risk by structure. Gap risk is the one that remains — and it is bounded, disclosed, and hedgeable.
Verify it yourself
Cadena's security claims are not things you have to take on trust. They are verifiable.
Open-source Signer App
The software that handles your keys is fully open-source. Read the code. Build it yourself. Verify that key generation, signing, and KYC do exactly what we describe.
github.com/CadenaWizard/cryptlibOn-chain proof
An early Cadena contract settled on Bitcoin’s mainnet on May 9, 2026 — funded Nov 2025, 6-month term. The architecture executed exactly per the pre-signed structure.
Verify the settlement transactionSecurity & Operations Memo
A full institutional-grade memo covering collateral security, oracle architecture, settlement mechanics, failure-mode coverage, and gap-risk hedging.
Read the Security & Operations MemoThe Security & Operations Memo
The Security & Operations Memo is written specifically for balance-sheet providers and institutional risk officers evaluating Cadena. It covers, in depth:
The full diligence package — including code repository access, mainnet transaction history, regulatory documentation, and counterparty profiles — is available within 48 hours of an institutional request.
Sound money deserves sound infrastructure. Every claim on this page is verifiable on Bitcoin's blockchain or in open-source code. If something here doesn't hold up to your scrutiny, we want to hear about it.