FediCash
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Terms of Service

Effective Date: March 7, 2026

1. The Nature of the Federation

By using FediCash (the "Federation"), you are entering into a voluntary community custody arrangement. The Federation is not a bank, nor is it a centralized exchange. It is a Federated Chaumian Mint operating on the open-source Fedimint protocol.

2. The Guardian Model & Threshold Trust

You acknowledge that your Bitcoin is held in a Distributed Multi-Signature Vault managed by a group of "Guardians."

Quorum Requirement

No single Guardian can access or move the vault funds. A majority (e.g., 3-of-4 or 5-of-7) of Guardians must reach a mathematical consensus to process withdrawals.

Risk of Collusion

While the Federation is designed to prevent theft, if a supermajority of Guardians collude, they could potentially seize the Bitcoin in the vault. Do not deposit more than you are willing to trust to this community quorum.

3. E-Cash Notes (IOUs)

When you deposit Bitcoin, the Federation issues you Blinded E-cash Notes.

  • These notes are bearer instruments. If you lose your digital wallet or seed phrase, the Federation cannot "reset" your password or recover your funds.
  • You are solely responsible for backing up your own e-cash notes.

4. Service Availability & "Liveness"

The Federation relies on independent Guardians running separate servers.

  • Resilience: The mint can continue to operate even if a minority of Guardians are offline.
  • Outages: If a majority of Guardians go offline simultaneously (due to internet outage, hardware failure, or coordinated action), the mint will become "stalled," and you will be unable to swap or withdraw funds until the quorum is restored.

5. Compliance & MSB Status

FediCash is a registered Money Services Business (MSB) with FinCEN.

  • KYC Requirements: You agree to provide accurate identity information as required by the Bank Secrecy Act (BSA).
  • Prohibited Use: You agree not to use the Federation for money laundering, terrorist financing, or any activity that violates U.S. federal law.
  • Suspension: We reserve the right to freeze the on-boarding/off-boarding gateway for users who violate these terms, though we physically cannot freeze the e-cash already in your possession.

6. No FDIC Insurance

DEPOSITS ARE NOT INSURED BY THE FDIC OR ANY GOVERNMENT AGENCY. The "insurance" for your funds is the mathematical integrity of the Bitcoin blockchain and the social reputation of the Federation Guardians. All deposits are backed 1:1 by Bitcoin; the Federation does not engage in fractional reserve banking.

7. Limitation of Liability

The Federation and its Guardians provide this service "as-is" and are not liable for losses resulting from:

  • Software bugs in the Fedimint open-source protocol.
  • Loss of your private keys or backup seeds.
  • Catastrophic failure of the Lightning Network or Bitcoin protocol.