Ducat Protocol

About

Ducat Protocol is a Bitcoin L1-native credit protocol that lets users borrow against their BTC without selling it or giving up custody. Users deposit BTC into a non-custodial 2-of-2 Taproot vault and can borrow UNIT, a dollar-pegged stablecoin issued on Bitcoin L1, or USDC for instant dollar liquidity. The protocol emphasizes that keys remain with the user, with no bridges, wrapping, or custodians involved. The protocol offers zero-interest borrowing with a one-time 7% fee, allowing users to borrow up to 62.5% of their vault's BTC value. Users can choose their collateral ratio from conservative to aggressive, monitor their position in real time, and repay at any time to redeem their BTC. Redemption is described as single-block on Bitcoin L1, and all loan logic—from vault creation to liquidation—is enforced by Bitcoin Script and verified on-chain. UNIT, the protocol's stablecoin, is backed by overcollateralized BTC in vaults and can be transferred instantly and without fees using a built-in ecash layer, or swapped 1:1 to USDC at any time via Circle. The platform provides a dashboard for tracking collateral ratio, liquidation price, and position adjustments, with real-time BTC price updates and a dynamic health indicator. Ducat Protocol is currently in Mainnet Closed Alpha, with testnet statistics cited as over 4 million transactions, $700M+ BTC vaulted, $300M+ UNIT minted, and 90K+ vaults created.