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Bitcoin Collateral Vaults

Recovery

Your ability to recover BTC from an eligible unspent vault is built into Bitcoin. After the committed timelock, the customer escape requires your signature, with no protocol co-signature or functioning destination chain.

This gives the vault an exit independent of Zest Protocol’s normal services. If the backend or destination chain is unavailable, Bitcoin continues to enforce the vault’s recovery conditions.

Recover with your key and public vault records

The recovery transaction uses your Bitcoin key, the vault’s public construction and script-path proof, and sufficient Bitcoin transaction fees. Your key stays in your signer; no additional protocol secret is required.

Keep the public construction, position commitments and transaction records accessible independently of the application. Together with Bitcoin chain data, these identify the current output, its amount and its recovery conditions. Verify your position explains the records.

Follow the BTC through its lifecycle

Partial actions preserve protection by creating outputs with their own defined spending paths:

Where the BTC isRecovery or payout path
Refundable preparation outputCustomer refund after its committed delay.
Unspent V2 vault or remainderCustomer escape after that output’s Bitcoin timelock.
Protected settlement payoutAcknowledged or delayed beneficiary payout, or a guardian-completed return for an invalid settlement.
Emergency re-vaultCustomer escape under the new vault’s construction and clock.

The escape delay is a relative Bitcoin block count. A remainder or re-vault begins its own clock, measured from that output’s confirmation. The current unspent output determines the applicable path.

Guardian protection and customer exit work together

Guardians independently review settlements and can return invalid payouts during the contest window. Customer escape provides the exit for BTC that remains in an eligible vault. Trust assumptions describes the quorum, evidence and chain requirements behind these complementary protections.

The separate emergency vault veto uses a customer-pre-signed return, the council threshold and a committed delay. The customer authorizes at most three chained re-vault transactions, each with fixed amounts and destinations. A re-vault starts a new clock and requires renewed coverage before lending resumes.

For normal repayment and release, see Closing your position. Recovery on Bitcoin and settlement of Ethereum debt remain separate actions.

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