Axal is built so that only you control your money, and every part of the system has been independently audited. But Axal is not a bank, and your balance is not FDIC insured. Here is exactly how it works and what the risks are.
Where does my money go?
When you deposit dollars, Axal converts them to USDC, a dollar-backed digital currency issued by Circle, a publicly traded company. Your USDC is lent to borrowers through established lending markets such as Morpho and Euler. Every loan is overcollateralized: borrowers must put up more value than they borrow, and the market automatically sells that collateral if a loan becomes unsafe. The interest borrowers pay is your yield. How Axal Works walks through an example.
Who holds my money?
You do. Axal is non-custodial: your funds sit in a wallet that belongs to you, created through our partner Privy. Your keys are stored inside hardware-isolated secure chips, and not even Axal can access them.
Has Axal been audited?
Yes. Security firm Sherlock audited Axal's signing system and production servers, and all identified issues were fixed. The full audit report is public.
What are the risks?
- Software risk: a bug in a lending market Axal uses could cause losses. Axal only uses established, blue-chip markets with multiple independent audits and hundreds of millions of dollars in deposits.
- Dollar-peg risk: USDC could temporarily trade below $1 in a crisis.
- Market stress: in extreme conditions, withdrawals could be delayed or collateral could fall faster than it can be sold.
- Regulatory risk: new rules could change how the product works.
Axal monitors every market it uses and moves funds away from any that become risky. Read the full risk overview and risk disclosures.
Is Axal FDIC insured?
No. Axal is not a bank, and balances are not covered by FDIC insurance. If you need government-backed deposit insurance, a bank savings account is the right choice for that money. See the FDIC's guide to what deposit insurance covers.
Can I withdraw anytime?
Yes. There are no lockups or withdrawal penalties. Withdrawals to a bank account typically arrive in 1–3 business days. See Withdrawals.