Understanding Asset States on BitLease

Every asset in your BitLease account exists in one of two states: Free or Locked. These states determine what operations are available and reflect the asset's contractual condition. Understanding these states helps set clear expectations and ensures smooth account management.

Why Asset States Exist

Asset states provide immediate clarity about the status of your assets:

• Free: The asset is available for use within platform permissions.

• Locked: The asset is part of an active contract and supports its payment structure.

This is more than just an access control mechanism—it’s a structural framework that reflects the asset’s contractual condition.

Free State

Definition

An asset in the Free state is not involved in any active contract. No contractual restrictions apply.

Where Free Assets Appear

• FUNDING Wallet:
  All assets in the FUNDING Wallet are Free.

• LTO Wallet (Post-Completion):
  After a contract is completed, assets in the LTO Wallet change to Free status.

Operations Available for Free Assets

Free assets support standard platform operations:

• Withdraw: Send to external addresses, subject to platform policies and compliance procedures.

• Trade: If trading features are available, Free assets may be traded.

• Convert: Exchange one cryptocurrency for another within the platform.

• Use in New Contracts: Free assets can be used as down payments for new LTO contracts.

• Transfer Internally: Move assets between the FUNDING and LTO Wallets where applicable.

• Hold: Retain assets in custody without taking any action.

Visual Indicators

The platform displays a “Free” label next to asset amounts, indicating availability for operations.

Locked State

Definition

An asset in the Locked state is part of an active LTO contract. It supports the payment structure and ensures contractual continuity.

Where Locked Assets Appear

• LTO Wallet Only:
  Locked assets exist exclusively in the LTO Wallet during active contracts.

Why Assets Lock

• Contract Integrity:
  Locked assets ensure the contract remains secure and stable throughout the payment period.

• Payment Structure:
  Installment payments progressively build equity in the locked asset.

• Ownership Transfer:
  Ownership transfers only after full payment, and the asset remains contract-bound during this period.

Locking is a structural requirement of the LTO model.

Operations Available for Locked Assets

• View Value: Monitor the current market value of the asset.

• Track Contract: View equity percentage, remaining payments, and the contract’s completion date.

• Make Payments: Use stablecoins from either wallet to make installment payments.

• Economic Participation: Market price movements are reflected in your economic position.

Operations Not Available for Locked Assets

• Cannot Withdraw: Locked assets cannot leave custody during an active contract.

• Cannot Trade: Locked assets cannot be sold or converted.

• Cannot Transfer: Locked assets cannot move to the FUNDING Wallet or to other users.

• Cannot Use in Other Contracts: Locked assets cannot be used as down payments or collateral for additional features.

Visual Indicators

The platform displays a “Locked” label along with contract reference details, such as:

• Contract ID

• Completion Date

• Current Equity Percentage

State Transitions

Free → Locked (Contract Creation)

Trigger: You create an LTO contract.

Example:

• Before:

  • FUNDING Wallet: $30,000 USDT (Free).

  • LTO Wallet: Empty.

• Action: Create a contract for 1 BTC with a 35% down payment ($23,800).

• After:

  • FUNDING Wallet: $6,200 USDT (Free).

  • LTO Wallet: 1 BTC (Locked).

Explanation:
The down payment leaves the FUNDING Wallet, and the contracted BTC appears in the LTO Wallet with a Locked status.

Locked → Free (Contract Completion)

Trigger: Your final installment processes successfully.

Example:

• Before:

  • LTO Wallet: 1 BTC (Locked).

• After:

  • LTO Wallet: 1 BTC (Free).

Explanation:
The asset remains in the LTO Wallet, but its status changes from Locked to Free. Full control is activated according to platform policies.

No Other Transitions

Assets cannot:

• Move from Locked to Free without completing or settling the contract.

• Move from Free to Locked without activating a contract.

• Exist outside the defined states of Free or Locked.

Multiple Assets in Different States

You can hold multiple assets in different states simultaneously.

Example Portfolio:

• FUNDING Wallet:

  • 5,000 USDT (Free).

  • 2 ETH (Free).

• LTO Wallet:

  • 0.5 BTC (Locked - Contract #1, 8 months remaining).

  • 5 ETH (Locked - Contract #2, 15 months remaining).

  • 0.3 BTC (Free - previous contract completed).

Each contract operates independently. Free assets remain separate from contract-bound assets.

Understanding Economic Value During Lock

Value Participation vs Transfer Control

Locked assets create a distinction:

• Economic Participation: Market price movements are reflected in your economic position during the contract.

• Transfer Control: Withdrawal and transfer rights activate only after the asset becomes Free.

Comparison

Ownership Type Value Participation Transfer Control Traditional Ownership Yes Yes Locked Asset Yes No Rental No No

LTO separates participation and control during the contract period.

State and Contract Terms

Lock Duration Matches Contract

The asset remains locked for the entire contract duration.

Examples:

• 6-month contract → 6 months locked.

• 12-month contract → 12 months locked.

• 24-month contract → 24 months locked.

Unlock timing is defined at contract creation.

Early Unlock

Standard contracts require completion of all payment obligations before unlocking. Some contracts may include:

• Early Settlement Options.

• Defined Termination Mechanisms.

Review your specific contract terms for details.

Termination Impact

If a contract terminates before completion:

• You retain payment history and any rights defined in the contract terms.

• Ownership does not transfer without full payment.

• Asset status changes according to contract provisions and platform policy.

State Visibility

Dashboard Indicators

Your dashboard shows:

• Total Balance: Combined value of Free and Locked assets.

• Available Balance: Value of Free assets only.

• Locked Balance: Value of assets in active contracts.

Example:

• Total: $85,000.

• Available: $15,000.

• Locked: $70,000.

Wallet View

Each wallet displays asset states clearly:

Example:

• FUNDING Wallet:

  • 5,000 USDT (Free).

  • 2 ETH (Free).

• LTO Wallet:

  • 1 BTC (Locked - Contract #12345).

  • 0.3 BTC (Free).

Labeling prevents operations on contract-bound assets.

Common Scenarios

Scenario 1: Need to Withdraw but Asset is Locked

Situation:
You need Bitcoin for an external payment, but your Bitcoin is locked in a contract with 6 months remaining.

Options:

• Wait for contract completion.

• Use available Free assets in the FUNDING Wallet.

• Review early settlement options if available under your contract terms.

Scenario 2: Multiple Contracts Completing at Different Times

Each contract completes independently.

Outcome:

• The specific asset changes from Locked to Free upon completion.

• Other active contracts remain unaffected.

Scenario 3: Converting Free Asset to Start a New Contract

Situation:
You hold 2 ETH (Free) in the FUNDING Wallet and want to create a BTC contract.

Process:

1. Convert ETH to a supported stablecoin.

2. Use the stablecoin as a down payment.

3. BTC appears in the LTO Wallet (Locked).

Result:

• FUNDING Wallet balance decreases.

• LTO Wallet reflects the new Locked asset.

This guide ensures you understand asset states on BitLease, helping you manage your portfolio with confidence.