Risks & assumptions, clearly stated.
Transparent disclosure of system guarantees, assumptions, and limitations of the DMF protocol.
Digital Monetary Framework (DMF) is designed to minimize trust assumptions through cryptographic enforcement and full-reserve accounting. However, no system is without assumptions or external dependencies.
This page clearly defines what are the facts by design about DMF, what it assumes, and what risks remain outside the protocol's control.
- All user balances are fully backed by on-chain reserves
- Outstanding balances never exceed protocol reserves
- Withdrawals are enforced by immutable smart contracts
- No lending, leverage, or rehypothecation of funds
- No administrative keys capable of draining reserves
- Public, real-time transparency of supply and reserves
dmfUSD is an autonomous smart contract. Once deployed, its behavior cannot be modified or overridden by any individual or entity.
This autonomy guarantees neutrality and censorship resistance, but it also means that no party can intervene to reverse transactions, recover lost keys, or modify protocol behavior in response to external events.
DMF is designed to reduce trust to the minimum possible level. Users are encouraged to independently verify smart contracts, reserves, and system behavior before using the protocol.
Reserve assets are issued by Circle and subject to issuer-level controls outside the DMF protocol.
- Circle-issued USDC maintains its contractual redemption guarantees
- Supported blockchains (Base, Ethereum, etc.) continue to operate according to their published consensus rules
- Users maintain control of their private keys and wallets
- Underlying cryptographic primitives remain secure
- DMF Swap & Bridge: Cross-chain access relies on the DMF Swap & Bridge app and its underlying routing infrastructure.
- Access Gating: Internal route-only functions are restricted for security.
- Bridge Dependencies: Settlement from non-Base chains depends on third-party bridge finality and route availability.
- Relayer Liveness: Cross-chain message delivery depends on decentralized or federated relayer networks.
- Regulatory changes affecting reserve-asset issuers or blockchain infrastructure
- Smart contract vulnerabilities in external dependencies
- Network congestion or temporary chain halts
- Wallet software bugs or user-side security failures
- Not a traditional bank or custodian
- Not an investment product
- Not a lending platform
- Not a yield-guaranteeing system
- Not dependent on liquidity pools or market makers