# Custodial Addresses Custodial addresses are a critical component of the FBTC project, used to manage the secure deposit and withdrawal of BTC assets. These addresses ensure that user funds are safely stored and accurately reflected in the FBTC system. ## Functionality ### Deposit Addresses **Assignment of Deposit Addresses** Each merchant is assigned a unique BTC deposit address. When a user deposits BTC into this address, it triggers the minting process, converting the deposited BTC into an equivalent amount of FBTC. **Deposit Verification** The system continuously monitors the blockchain for incoming transactions to these deposit addresses. Upon detecting a deposit, the system verifies the transaction details and updates the user's FBTC balance accordingly. **Security Measures** Deposit addresses are managed using Multi-Party Computation (MPC) and Multi-Signature (Multi-Sig) techniques to ensure that no single entity has complete control over the assets. This decentralized approach significantly enhances the security of user funds. ### Withdrawal Addresses **Assignment of Withdrawal Addresses** Each merchant is also assigned a unique BTC withdrawal address. When a user initiates a burn request to convert FBTC back to BTC, the system sends the corresponding BTC amount to this withdrawal address. **Withdrawal Verification** The system verifies the burn request details and ensures that the correct amount of BTC is sent to the merchant's withdrawal address. This process involves multi-signature validation to maintain security and accuracy. **Security Measures** Similar to deposit addresses, withdrawal addresses are also managed using MPC and Multi-Sig techniques to protect against unauthorized access and ensure the safety of user assets. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.fbtc.com/system-components/custodial-addresses.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.