diff --git a/LOTUS_BUGS.md b/LOTUS_BUGS.md
index c2241f02b..72d0248df 100644
--- a/LOTUS_BUGS.md
+++ b/LOTUS_BUGS.md
@@ -5,57 +5,68 @@ This document tracks identified bugs, edge cases, and architectural discrepancie
---
-## โ Resolved Issues
+## ๐ฉ Critical & UI Bugs
-- **Ringing Modal Fires in Voice Rooms**: Fixed in `CallEmbedProvider.tsx` โ only `notification_type === 'ring'` events now trigger the modal.
-- **Avatar Decoration Displacement in Profile**: Fixed in `UserHero.tsx` โ `UserAvatarContainer` (position:absolute) now wraps `AvatarDecoration` as the outermost element, keeping the positioning context relative to `UserHeroAvatarContainer`.
-- **Export History Broken for E2EE**: Fixed in `ExportRoomHistory.tsx` โ `addEvents` is now async and calls `mx.decryptEventIfNeeded()` before inspecting event type/content.
-- **Privacy Leak in URL Previews (Google Favicon)**: Fixed in `UrlPreviewCard.tsx` โ Google S2 favicon call removed; a generic folds `Icons.Link` icon is shown instead.
-- **Status Emoji Picker Doesn't Insert Emoji**: Fixed in `Profile.tsx` โ `statusDirtyRef` prevents the server-presence sync `useEffect` from overwriting in-flight user input (cleared on save/clear).
-- **Encrypted Search Misses Stickers and Polls**: Fixed in `useLocalMessageSearch.ts` โ `m.sticker`, `m.poll.start`, and `org.matrix.msc3381.poll.start` events now included; poll question and answer bodies are indexed.
-- **Seasonal Themes Display Behind Chat Background**: Fixed in `SeasonalEffect.tsx` โ z-index bumped from 9997 to 9999.
-- **Windows Taskbar Badge Black Square**: Fixed in `src-tauri/src/lib.rs` โ `std::ptr::write_bytes` zeros the DIB bits buffer immediately after `CreateDIBSection`; previously uninitialized bytes caused garbage pixels with alpha=255.
+### 1. Avatar Decoration Displacement in Profile
+**File:** `src/app/components/user-profile/UserHero.tsx`
+**Status:** **OPEN**
----
+* **Issue:** Avatar decorations appear displaced left of the avatar when viewing the profile modal.
+* **Root Cause:** The `AvatarPresence` badge sticking out to the right shifts the center of the `inline-flex` container. The decoration centers on the container, not the avatar.
+* **Recommended Fix:** Wrap only the `Avatar` component with `AvatarDecoration`.
-## ๐ก๏ธ Pending โ Critical Security & Logic
-
-*(none currently open)*
-
----
-
-## ๐ฉ Pending โ Functional & UI Bugs
-
-### 1. Avatar Decoration Images Not Rendering
-**File:** `src/app/features/lotus/avatarDecorations.ts`
-**Status:** **OPEN โ Blocked on infrastructure**
-
-* **Issue:** Decoration images in Settings do not load.
-* **Root Cause:** The Nextcloud WebDAV URL (`public.php/dav/files/โฆ`) returns `Content-Disposition: attachment`, which browsers refuse to render in `` tags.
-* **Required Fix:** Move decoration assets to a CDN or file host that returns `Content-Type: image/png` with `Content-Disposition: inline`. Options: Gitea LFS, Cloudflare R2, or a dedicated static file host. Alternatively, reconfigure the Nextcloud share to serve inline.
-* **Blocked by:** Infrastructure change (not a code fix).
-
----
-
-## ๐จ Pending โ UI/UX & Visual Consistency
-
-### 1. Inconsistent Settings Dropdown Styling
+### 2. Inconsistent Settings Dropdown Styling
**Files:** `Profile.tsx`, `SystemNotification.tsx`
-**Status:** **OPEN โ Low priority**
+**Status:** **OPEN**
* **Issue:** Dropdowns for Status Expiry and Notification Sounds use raw HTML `