# Why Ketju rejected SolvBTC

- URL: https://riadefi.com/rejections/solvbtc/
- Exposure: other
- Memo version: v1
- Reviewed: 2026-08-17
- Next review: 2026-11-17

## The memo

REJECTED, DESPITE REAL STRUCTURAL IMPROVEMENTS, ON A RECENT REALIZED EXPLOIT. SolvBTC is a tiered Bitcoin reserve token, not a single-custodian wrapper: a Core Reserve of native BTC plus BTCB and cbBTC backs most of the token, while a capped, rate-limited Innovative Reserve holds already-rejected wrapped assets including WBTC and FBTC. Solv has made genuine governance progress — a FROST-based multi-party signing upgrade completed in early 2026, continuous audits from three named firms, and Chainlink Proof of Reserves — more independent verification than most entries in this bridge batch. But in March 2026 a reentrancy bug in a related vault let an attacker mint far beyond the intended supply and extract about $2.7M; Solv pledged to cover the loss but the funds were not confirmed returned. Combined with a stated multi-day to two-week redemption window, this is a realized smart-contract failure five months before this review, not a hypothetical one, and it does not clear the bar for approval even with the strongest governance in this batch.

## What would reopen the file

- Twelve consecutive months with no smart-contract exploit following the March 2026 BitcoinReserveOffering incident, with an independent post-mortem and remediation audit published
- A proposed-size redemption is demonstrated to complete within a documented, tested maximum window under stress conditions
- Innovative Reserve composition and its caps are independently verifiable on-chain, not self-reported
- The FROST multisig signer set and threshold are fully disclosed and confirmed operative

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Published by Ketju Research (https://ketjuresearch.com). Educational analysis only; not legal, tax, compliance, or investment advice.
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