> For the complete documentation index, see [llms.txt](https://cvnnt.gitbook.io/documentation/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://cvnnt.gitbook.io/documentation/how-it-works/verifiable-statefulness.md).

# Verifiable statefulness

Covenant system core design is hybrid, with Bitcoin-derived UTXO core and frictionless intrinsic EVM which is repesented by the exact EVM Ethereum utilizes. 

This merged structure allows Covenant to  seamlessly"speak both languages" - Covenant supports both Bitcoin and EVM logic paradigms, and recognizes, builds and executes both Bitcoin scripting language and EVM machine commands. 

All assets in Covenant system also combine UTXO and account-based properties. They are managed as UTXO assets by UTXO rules. However, these assets have EVM-compatible properties, so they are recognized native both for Bitcoin blockchain and EVM networks when moving assets cross-chain. 

Also, EVM properties in addition with smart contract functionality support allows asset metadata programmed manipulation.

This hybrid structure and derived unique synergetic features allow Covenant system to provide desired statefulness functionality over Bitcoin-origin channels and assets.

### Verifiable statefulness core opportunity for BTCFi

Verifiable statefulness along with complete smart contract-based automation allows Covenant system to eliminate trusted entities, custody requirements, intermediaries or off-chain operations.

BTC DeFi with Covenant system stateful channels is what DeFi should originally be - programmable, fast, predictable, self-custodial and safe.

### How the statefulness property is performed

To provide the channel state on Covenant system, the channel is represented as a hybrid type asset. 

When creating the BTC channel using Covenant system, on the Bitcoin blockchain channeled BTC is deposited and released with ordinary Bitcoin scripts. Thus, on Bitcoin stateful channel is a usual BTC (UTXOs) locked safely with Bitcoin script.

In the Covenant system the channel is represented as a transferrable object - a unique, NFT-like asset with Bitcoin-native UTXO basis and EVM-compatible properties like metadata. 

Statefullness is then achieved via operating the channel object' EVM properties. Each channel state change - transfer, ownership change, cross-chain movement or other operation - is written in the channel asset itself and can be observed onchain along with its state changing operations.

When moving to EVM network, the original channel object is locked within Covenant system, while its unique representation directly linked to it is minted on the destination chain. 

All cross-chain transfers using Covenant system are performed without bridges or wrapping, and rely only on integrated networks' finalized state.

### Frequently asked questions

<details open>

<summary>How can I check whether the operation in channel is really stateful?</summary>

You can always find the asset and its corresponding state changes onchain. This data is publicly available to any interested party.

</details>

<details>

<summary>How can I be sure the channel asset is always unique, without duplications?</summary>

Covenant system is UTXO-based (original fork of Bitcoin at its core) and works on UTXO rules. Double spending with UTXO is impossible, so no second duplicate asset can appear.

</details>