Nexio bridges traditional credit systems with Bitcoin’s security model. To understand how it works, we’ll cover the building blocks below before going into greater depth in subsequent sections.
A Series is a ring-fenced BTC lending pool with fixed terms, similar to a fixed-term fund in traditional finance.Each Series corresponds to one borrower and is backed by its own Taproot vault. Multiple lenders can deposit into a Series once it opens for participation, but the BTC in that Series is used only for that borrower’s strategy and cannot be mixed elsewhere.Each Series has:
A defined strategy (e.g., CME basis, delta-neutral, market-making)
A fixed interest rate and duration
Named, KYC/KYB-verified borrowers
On-chain visibility into utilization, collateralization, and covenant status
When lenders deposit BTC into a Series, their funds are used only within that Series. No cross-mixing or rehypothecation occurs.
When BTC is deposited into a Series, the depositor receives uBTC, an on-chain receipt that represents proportional ownership in that Series and its yield. uBTC functions like a Bitcoin-denominated certificate of deposit (CD): its redemption value increases automatically as the borrower pays coupons.The Series’ value increases as borrowers pay coupons, which raises the redemption value of each uBTC token. Because uBTC minting and burning are linked to verified Bitcoin transactions, the uBTC supply always matches the BTC actually held in custody.
Show Example: Lending 10 BTC into a Series
Suppose a lender deposits 10 BTC into a Series offering a 7% fixed coupon over 90 days.Upon confirmation of the Bitcoin transaction and validation by the Operator Queue, Nexio mints uBTC representing that lender’s proportional share of the Series. If the total Series pool is 100 BTC, the lender’s uBTC represents 10% ownership (10 BTC of the 100 BTC).Borrowers pay interest into the Series, causing its balance to grow, for instance, from 100 BTC to 103 BTC. The uBTC share price automatically reflects this increase.At maturity, the lender burns their uBTC on chain, and Nexio’s vault releases the corresponding 103 BTC directly back to their registered Bitcoin address.
The left side of the graphic below illustrates this:*Example figures
The Master Vault acts as a meta-layer that automatically allocates pooled BTC across multiple Series. Rather than lending or borrowing to an individual Series, participants can deposit once into the Master Vault and receive yBTC.The Master Vault aggregates these returns and updates the yBTC value accordingly. As yields accrue across the underlying Series, yBTC’s redemption value automatically increases, giving holders diversified BTC yield exposure without managing individual Series.Below is an example to help illustrate this:
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A lender deposits 10 BTC into a 90-day Series offering a 7 % fixed coupon.If the total Series holds 100 BTC, the lender owns 10 %.When the borrower repays, the Series balance grows (e.g., from 100 → 103 BTC), and the uBTC share price adjusts accordingly.At maturity, the lender burns their uBTC on-chain, and the vault releases the corresponding BTC directly to their registered Bitcoin address.
All BTC remains secured within Taproot Vaults on the Bitcoin network, which refer to specialized Bitcoin addresses that enforce programmable spending conditions. Each Series has its own Taproot Vault, functioning like a segregated on-chain account holding BTC for that Series alone. Each Series also has its own legal agreements and borrower-specific covenants.The vaults are controlled by threshold-signature schemes, ensuring that no single operator can move funds unilaterally.As each Series has its own dedicated vault, all collateral and activity are segregated from other Series or the Master Vault. Each vault encodes predefined recovery and emergency paths, allowing governance to reclaim funds if operations halt or infrastructure fails safely.
There are three types of signed, enforceable contracts that back every borrower and Series:
The Master Loan Agreement (MLA): The MLA is a standing contract between Nexio and each approved borrower. It defines the legal framework for all future lending activity — including repayment obligations, event-of-default rules, and dispute resolution.
The Pledge Agreement: This agreement defines the borrower’s collateral obligations. It specifies which assets are pledged, how they are held in custody, and the process for liquidation or recovery in the event of a default.
Series Term Sheets: The Term Sheet applies to one specific Series. It lists the coupon rate, duration, collateral requirements, and covenants governing the particular BTC lending program.
The hash of each document is stored on-chain, allowing anyone to verify that a loan is operating under approved legal terms.
