Acre Deployment Policy

Deployment Policy Adopted by Acre DAO Security Council vote on Jul 27, 2025

1. Purpose 1.1. This Deployment Policy establishes the governance framework for deploying Acre-deposited assets into Bitcoin-native reward opportunities. The objective is to generate sustainable, risk-adjusted rewards while preserving capital, maintaining liquidity, and supporting Acre’s long-term resilience and the growth and sustainability of the BitcoinFi ecosystem.

2. Scope 2.1. This policy governs all deployments made by the protocol smart contracts using deposited assets for which the Acre DAO has dispatch governance. All deployments must adhere to this policy unless amended through proper DAO governance, as outlined in the Acre DAO Constitution.

3. Deployment Objectives 3.1. Reward Generation: Maximize risk-adjusted returns from Bitcoin-native and Bitcoin-adjacent protocols. 3.2. Ecosystem Alignment: Prioritize protocols advancing and strengthening the BitcoinFi stack 3.3. Capital Preservation: Protect deposits through diversification and risk management. 3.4. Liquidity Maintenance: Ensure sufficient liquidity to meet protocol obligations (e.g. redemptions, incentive programs, and internal rebalancing). 3.5. On-Chain Transparency: All deployments must be trackable, auditable, and verifiable on-chain.

4. Eligible Deployment Categories Subject to DAO review and smart contract implementation, eligible deployments include: 4.1. Bitcoin-native Staking or Liquidity Programs 4.1.1. Projects offering native BTC or wrapped BTC rewards 4.1.2. Examples: DLCs, Lightning channel leasing, or Layer 2 liquidity provisioning 4.2. Bitcoin-aligned Lending Protocols 4.2.1. Decentralized lending platforms that accept BTC or chain-native BTC derivatives including tBTC. Minimum requirement: overcollateralized positions and transparent risk modeling 4.3. Reward Aggregators and Vault Strategies 4.3.1. Audited vaults built on protocols with audited smart contracts 4.3.2. Risk disclosures must be public and verifiable 4.4. Strategic Ecosystem Grants or LP Positions 4.4.1. DAO-approved deployments in early-stage Bitcoin-focused or Bitcoin native projects 4.4.2. Subject to vesting, milestone-based disbursement and clawback terms where applicable.

5. Risk Management 5.1.1. Maximum Exposure Limits: No more than 50% of deposits in a single vetted protocol, and no more than 25% in a single product 5.1.2. Minimum 2% held in reserve as BTC or tBTC and remain liquid (redeemable <48 hours) 5.2. Diversification Standard 5.2.1. Minimum 2 active deployments or 2+ protocols across distinct yield verticals 5.3. Due Diligence Standards: 5.3.1. Audits or formal verification of all smart contracts 5.3.2. Public documentation of counterparty risk and technical architecture 5.3.3. DAO or security committee review before new strategy whitelisting 5.4. Rebalancing and Exit Criteria: 5.4.1. Periodic reviews every 90 days 5.4.2. Auto-withdrawal if exploits occur, 5.4.3. DAO vote mandates exit

6. Governance and Implementation 6.1. All deployment actions must be executed by DAO-approved smart contracts or authorized multi-sig agents with predefined logic. Changes to this policy require a formal DAO proposal and approval, as outlined in the Acre DAO Constitution. 6.2. Emergency actions (e.g. mass withdrawal) may be executed by predefined smart contract logic or DAO emergency powers, as outlined in the Acre DAO Constitution.

7. Reporting 7.1. Rewards, performance, and risk metrics will be reported on-chain.

8. Policy Review 8.1. This Deployment Policy shall be reviewed at least once per year or upon major protocol upgrades, market shifts, change in DAO governance or treasury composition.