pledgeScoring factors
8
Each factor is weighted and scored 0–10 before blending into a composite.
What 10/10 means
A perfect score would be boring, proven, and hard to misunderstand.
None of the current Digital Credit products earns that standard. Strategy securities have strong public disclosure but are issuer credit, not collateralized bitcoin claims. Wrapper products can be useful, but they need deeper proof, cleaner exits, and less ambiguity before they approach elite scores.
25% weight≥ 20%
Backing Source
We start with what actually supports the claim: direct BTC, public preferred securities, treasury tokens, hedged BTC positions, or a layered collateral basket. For a Bitcoin holder, backing quality is about what can actually be proven and claimed under stress.
10/10 standard
A 10/10 product would have simple, enforceable, frequently proven backing with no ambiguity between Bitcoin exposure, issuer credit, and wrapper claims.
Evidence checked
Backing asset type (spot BTC, BTC reserves, other crypto, off-chain treasury, dividend preferreds)
On-chain reserve proof or public reserve dashboard URL
Reserve ratio relative to stablecoin supply
Scoring bands
Fully backed by spot BTC or BTC reserves with live on-chain proof: 9–10
BTC-backed synthetic or CDP design with named hedge, collateral, and reserve mechanics: 7–8.5
Mixed crypto collateral with meaningful BTC exposure and visible collateral policy: 5–6.5
Offchain treasury assets, dividend preferreds, or tokenized securities rather than direct BTC collateral: 3–5.5
Opaque, uncollateralized, or primarily algorithmic backing: 1–3
15% weight10–15%
Mint & Redemption Path
We care about how exposure is created, who can enter or exit, whether redemption is direct or permissioned, and whether the practical exit is a real redemption path or just secondary-market liquidity.
10/10 standard
A 10/10 product would let ordinary eligible users understand exactly how to enter and exit, with clear timing, fees, gating, pause conditions, and stressed-market treatment.
Evidence checked
Direct redemption available (permissioned or permissionless)
Redemption fee and minimum redemption size
Settlement time and counterparty for redemption
Scoring bands
Direct permissionless redemption at face value: 9–10
Direct permissioned redemption (known issuer, reasonable process): 6–8
Market-based redemption only (depends on DEX liquidity): 3–5.5
No redemption path or only issuer-managed secondary: 1–3
15% weight10–15%
Peg Design
Not every product is trying to hold a dollar peg. Some are securities, some are base dollars, some are yield wrappers, and some are synthetic dollars. We penalize products whose label makes the economic claim easy to misunderstand.
10/10 standard
A 10/10 product would make its economic claim unmistakable: stable dollar, listed preferred, yield wrapper, or hedged synthetic, with no marketing blur.
Evidence checked
Peg mechanism (hard peg, overcollateralized vault, algorithmic, dynamic reserve)
Policy range or stability mechanism description
Historical peg deviation data if available
Scoring bands
Overcollateralized vault with hard peg and transparent policy: 9–10
Partial reserve or BTC-backed with policy range: 6–8
Algorithmic or market-based peg without full collateral: 3–5.5
Uncollateralized or opaque peg mechanism: 1–3
10% weight10–15%
Yield Source
If a product advertises yield, we separate the base asset from the yield layer and identify whether return comes from dividends, funding rates, protocol fees, lending, incentives, or issuer policy.
10/10 standard
A 10/10 product would show a plain, durable yield source that does not depend on hidden leverage, unexplained subsidies, or users mistaking income for Bitcoin appreciation.
Evidence checked
Yield source (protocol fees, basis trades, dividends, lending, incentives)
Whether yield is in the base stablecoin or a separate wrapper token
Yield sustainability and whether it depends on token inflation
Scoring bands
Yield from real protocol revenue (fees, basis trades) with base dollar separate: 8–10
Yield from BTC or crypto lending with reserve backing: 5–7.5
Yield primarily from wrapper token incentives or inflationary rewards: 2–4.5
Opaque or undocumented yield source: 1–2
10% weight10–15%
Liquidity & Exit Depth
Headline supply is not enough. We look at whether users can realistically buy, sell, redeem, unstake, or unwind without relying on one thin pool, one frontend, or one issuer-controlled flow.
10/10 standard
A 10/10 product would have deep, durable, multi-venue exit depth plus a documented redemption or repurchase path that survives ordinary market stress.
Evidence checked
Daily DEX trading volume in USD equivalent
CeFi listing pairs and market depth
Slippage data for realistic exit sizes ($10K–$1M)
Scoring bands
Daily volume > $10M with deep order books and CeFi access: 8–10
Daily volume $1M–$10M with reasonable CeFi or DEX depth: 5–7.5
Daily volume < $1M or thin market with wide spreads: 2–4.5
Minimal exit options or single thin pool: 1–2
10% weight10–15%
Smart-Contract & Bridge Exposure
Cross-chain minting, vault contracts, exchange hedges, wrapped assets, and staking wrappers all widen the operational surface area. We give simpler surfaces more credit unless the added complexity is clearly proven and necessary.
10/10 standard
A 10/10 product would minimize technical surface area or prove it with mature audits, live monitoring, conservative controls, and clear emergency procedures.
Evidence checked
Chain count and whether cross-chain minting is required
Bridge dependencies and audit status of bridge contracts
Wrapper token usage and additional contract surface area
Scoring bands
Single chain, no bridge dependencies, independently audited contracts: 8–10
1–2 bridge hops with audit evidence: 5–7.5
Multi-chain with limited audit coverage: 2–4.5
Heavy cross-chain exposure with no public audit: 1–2
10% weight10–15%
Governance & Counterparty
Who can change parameters, pause contracts, custody collateral, rebalance reserves, adjust dividends, or decide redemptions matters as much as the backing itself.
10/10 standard
A 10/10 product would make control rights, seniority, custody, issuer discretion, and emergency powers boringly explicit.
Evidence checked
Custodian name and whether keys are multisig or hardware-wallet managed
Admin key holders and whether governance is decentralized or centralized
Legal entity and jurisdiction of the issuing organization
Scoring bands
Control rights are legally explicit: decentralized/multisig custody with no single admin key, OR a single-issuer structure (e.g. a listed preferred) whose seniority, custody, dividend discretion, and covenants are spelled out in binding public documents: 8–10
Single recognized issuer or custodian with documented security/governance practices, but some discretion or terms left to policy rather than binding covenant: 5–7.5
Genuinely opaque control: concentrated custody or issuer discretion with thin or no public governance documentation: 2–4.5
No identifiable controlling entity or no public governance information at all: 1–2
5% weight≤ 5%
Transparency & Proof
We prefer products with official docs, current dashboards, audits or attestations, sourceable market data, and plain-language risk warnings. Thin disclosure drops a product into watchlist territory fast.
10/10 standard
A 10/10 product would let a serious allocator verify the claim, source of yield, exit route, and control risks without relying on a founder thread or marketing page.
Evidence checked
Plain-language public documentation and dashboard URL
Auditor or attestation name and last audit/attestation date
Frequency of reserve or proof-of-reserves publications
Scoring bands
Live public dashboard, Big Four or equivalent auditor, frequent attestation: 8–10
Regular reports from named third-party auditor: 5–7.5
Annual-only or self-reported disclosure: 2–4.5
No public proof or attestation: 1–2