Ducat Protocol

Ducat Protocol is a groundbreaking Bitcoin L1-native credit protocol that enables users to borrow stablecoins, specifically UNIT or USDC, directly against their Bitcoin holdings without the need to sell their BTC. It leverages non-custodial Taproot vaults, ensuring users retain full control over their private keys throughout the loan process, eliminating counterparty risk. The protocol's core mechanism involves depositing BTC into a 2-of-2 Taproot vault, allowing users to mint or borrow stablecoins. A key feature is its 0% APR on loans, with a simple one-time 7% minting service charge applied when UNIT is issued. Users can manage their vault, monitor collateral ratios, and adjust positions via a single dashboard, with the flexibility to repay at any time and redeem their Bitcoin in a single block. Built on the robust security of Bitcoin L1, all loan logic, from vault creation to liquidation, is enforced by Bitcoin Script and verifiable on-chain. This approach bypasses the risks associated with bridges, wrapped tokens, or Layer 2 solutions, providing a truly decentralized and secure lending experience for Bitcoin enthusiasts.