DMM: Defensive Maintenance Mode

Operator & jurisdiction: BASIS is operated by BASIS DIGITAL INFRASTRUCTURE LTD, a Seychelles-incorporated entity (LEI: 254900IX2F2KCWNSSS64).

Currency convention: Portfolio views may display USD-equivalent values using USDT as an internal accounting unit. USDT is not a depositable or withdrawable asset on BASIS. Supported native token flows are BTC, ETH, SOL, and PAXG.

Defensive Maintenance Mode (DMM) is the most severe operational state in the BASIS control hierarchy. While automated safeguards can respond immediately to defined trigger conditions, DMM is a deliberate platform-wide protection state that requires human review and a formal Root Cause Analysis (RCA) before normal operations can resume.

1. When DMM Is Activated

DMM is entered when conditions are too severe, too uncertain, or too structurally complex for automated controls alone. These include, but are not limited to:

• Persistent safeguard triggers: repeated trigger events within a short interval, indicating a systemic issue rather than a transient anomaly

• Exchange insolvency or withdrawal halt: a whitelisted venue announces halted withdrawals, reports a security breach, or exhibits signs of financial distress

• Regulatory action: a material regulatory event affects the platform, a connected service provider, or a whitelisted venue

• Internal system compromise: any indication of unauthorized access, critical software failure, or a breakdown in security controls

• Severe market infrastructure dislocation: a major USD-equivalent pricing reference becomes unstable, impairing reliable valuation or settlement assumptions

• Routing or execution integrity failure: loss of deterministic execution guarantees, unacceptable divergence in expected execution precision, or infrastructure degradation affecting safe operation

DMM is a safety mechanism, not a discretionary performance tool. It is designed to preserve asset integrity, maintain state consistency, and prevent cascading failures during high-uncertainty events.

2. The DMM Protocol

Once DMM is activated, the following protocol is executed:

1

Full halt

All automated trading, staking actions, swaps, and withdrawal processing are suspended.

Responsible: System

2

State freeze

All active operational states are frozen. No new orders are placed, and no existing orders are modified unless required for containment.

Responsible: System

3

Incident declaration

A formal incident is declared and the operations function is mobilized.

Responsible: Operations Lead

4

Root Cause Analysis (RCA)

The team investigates the triggering event to determine cause, scope, affected systems, and possible asset impact.

Responsible: Engineering and Risk

5

Impact assessment

The team quantifies financial, operational, and user-level effects, including any disruption to staking balances, swaps, or withdrawal processing.

Responsible: Risk and Finance

6

User communication

An official status update is issued explaining the incident, current asset state, operational restrictions, and expected next steps.

Responsible: Operations

7

Resolution and recovery plan

A controlled recovery plan is prepared to restore services safely under verified conditions.

Responsible: Engineering and Risk

8

Manual approval to resume

Operations resume only after the RCA is complete, recovery controls are validated, and explicit manual approval is granted by an authorized senior operator.

Responsible: Operations Lead

3. User Impact During DMM

During DMM, users should expect:

• No new rewards to accumulate while protected operations remain paused

• Withdrawals to be delayed until asset integrity, ledger consistency, and settlement pathways are revalidated

• Swaps to be unavailable during the incident window

• Regular status updates through official support and platform communication channels

Wallet model reminder:

• Funding Wallet: holds native tokens for deposit and withdrawal

• Staking Wallet: holds stTokens for staking and reward accumulation

During DMM, balances remain visible, but restricted actions may be temporarily unavailable until safe resumption is confirmed.

4. Why DMM Matters

A reliable stop-and-assess mechanism is a core part of resilient digital asset infrastructure. When uncertainty exceeds the safe operating envelope, deterministic execution and state-machine risk controls must take priority over continuity.

BASIS is designed around:

• deterministic execution

• mathematical constraints

• state-machine risk controls

• proprietary routing infrastructure

• structural alpha capture through disciplined execution precision

This operating model is supported by research from Base58 Labs, with infrastructure principles centered on controlled state transitions rather than discretionary intervention.

5. Operational Principles Behind DMM

DMM exists to ensure that exceptional events are handled with discipline rather than improvisation. In practice, this means:

Principle	What it means in DMM
Asset safety first	Outflows and automated actions remain restricted until verification is complete
Deterministic recovery	Service restoration follows a documented sequence, not ad hoc operator decisions
Auditability	Every state transition, approval, and recovery step is logged for review
Communication discipline	Users receive factual updates based on verified information
Controlled resumption	Services return incrementally only after risk controls are confirmed

6. Resumption Criteria

Normal operations are restored only when all of the following conditions are satisfied:

• the triggering event has been identified and contained

• core systems have passed integrity checks

• pricing, routing, and settlement dependencies are functioning within acceptable thresholds

• user ledger states are reconciled

• withdrawal pathways are verified

• an authorized operator provides explicit sign-off

DMM is a sign of operational maturity. It reflects a controlled approach to infrastructure safety, where protection of user assets and system integrity takes precedence over immediate restart.