Bankruptcy Remote Structure
This page explains how Evolve structures user assets and Vault operations to achieve bankruptcy-remoteness by design—i.e., to isolate Vault assets and Vault liabilities from the operating company’s balance sheet and from unrelated creditors, to the maximum extent practical given the legal and operational setup.
Objective
Ring-fence each Vault’s assets and liabilities from Evolve’s corporate assets and liabilities
Reduce the risk of commingling, set-off, or creditor attachment in an insolvency scenario
Ensure Vault cashflows are applied only to Vault obligations, based on a defined recourse perimeter
Provide governance, controls, and documentation that support enforceability
Core building blocks
1) Asset segregation at the wallet and account level
Each Vault operates with a dedicated MPC wallet set:
deposit
collateral/strategy
redemption/processing
Each Vault uses dedicated exchange sub-accounts with explicit Vault attribution (where relevant)
Vault assets are tracked and reported Vault-by-Vault (positions, NAV, token supply, liabilities)
2) Vault-level ring-fencing of liabilities
Vault liabilities (fees, execution costs, hedging costs, operational expenses) are allocated to the Vault under the Vault terms
No cross-Vault support: assets of one Vault are not used to satisfy another Vault’s obligations
Cash movement pathways are constrained to the Vault’s approved lifecycle flows (deposit → strategy → redemption)
3) Contractual recourse perimeter (who can claim what)
Strategy counterparties and service providers contract on Vault-scoped terms, intended to limit recourse to the relevant Vault assets where applicable
User terms define:
payment waterfall
mint/redeem mechanics
fee mechanics
Transfers, execution, and protocol interactions are constrained to:
whitelisted endpoints
whitelisted assets
controlled roles and permissions
4) Operational separation from corporate treasury
Evolve maintains a separate operating treasury distinct from Vault assets
Corporate expenses are funded from operating treasury—not from Vault assets—except for Vault-attributable expenses explicitly disclosed in Vault terms
Diagram — bankruptcy-remote intent
Control framework supporting remoteness
Segregation controls
Dedicated wallets/accounts per Vault
Vault-level ledgers and reporting outputs
Prohibition on cross-Vault transfers (unless explicitly defined via a controlled, versioned process)
Permissioned asset movement
Role-based controls across software modules and signing policies
Maker-checker approvals for sensitive actions
Immutable onchain audit trails for all wallet movements
Reconciliation and attestations
Reconcile MPC + exchange balances to Vault ledgers and token supply
Investigate and document exceptions with clear ownership and resolution notes
Attestations / audits where applicable (and disclosed per product)
Versioned Vault terms
Controlled changes to fees, valuation policy, risk limits, and whitelists
Clear governance workflow (proposal → review → approval → versioned release)
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