# Money Protocol

> Money Protocol is a decentralized, self-custodial Bitcoin liquidity system. BTC holders deposit Bitcoin as collateral and mint BPD, a USD-pegged stablecoin, against it at **0% interest**, repaying whenever they choose without ever giving up custody. Money Protocol is built for long-term Bitcoin holders who want dollar liquidity without selling BTC, without trusting a CeFi counterparty, and without recurring interest charges.

Money Protocol's design principles:
- **0% ongoing interest.** Costs are a one-time borrow fee at issuance plus an algorithmic redemption fee — no APR that compounds over time.
- **Self-custody throughout.** Bitcoin collateral is locked in audited smart contracts the borrower controls, never in a company treasury.
- **Permissionless.** No KYC at the protocol layer, no credit checks, no geographic gating.
- **Rule-based liquidation.** Every vault faces the same published 110% minimum collateral ratio under normal operation. There are no manual margin calls.
- **Composable BPD output.** The minted stablecoin is fungible and usable anywhere stablecoins are accepted.

## Core pages

- [Money Protocol homepage](https://www.moneyprotocol.co/): Product landing page, headline messaging, and "Launch Now" entry point. The headline is "0% Interest Loan, 100% Backed by Bitcoin."
- [Frequently Asked Questions](https://www.moneyprotocol.co/faq): Comprehensive FAQ covering Bitcoin-backed borrowing, the vault model, collateral ratios, liquidation, recovery mode, costs, and how Money Protocol differs from CeFi lenders and Aave.

## Documentation

- [Documentation index](https://docs.moneyprotocol.co/docs/intro): Money Protocol overview and getting-started guide.
- [Benefits of Money Protocol](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/): Why use this system over alternatives.
- [Annual interest rate (0%)](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/annual-interest-rate): How Money Protocol structurally maintains 0% interest.
- [Collateral ratio](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/collateral-ratio): Minimum 110% ratio in normal operation; how to set a safe ratio.
- [Immutability and no admin key](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/immutability-and-no-admin-key): Protocol contracts cannot be altered by any team or admin.
- [MP token early-adoption incentives](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/mp-token-early-adoption-incentives): How early users are rewarded.
- [MP token staking](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/mp-token-staking): Stake MP to earn a share of protocol fees.
- [No governance, algorithmic monetary policy](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/no-governance-and-complete-algorithmic-monetary-policy): Why the protocol does not require governance votes.
- [Resistance to censorship](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/resistance-to-censorship): How permissionless smart contracts resist takedown.
- [Strong price-floor stability](https://docs.moneyprotocol.co/docs/benefits-of-money-protocol/strong-price-floor-stability): The peg-stability mechanism for BPD.

## System rules and features

- [System rules and features index](https://docs.moneyprotocol.co/docs/system-rules-and-features/): Mechanics overview.
- [Borrower activities](https://docs.moneyprotocol.co/docs/system-rules-and-features/borrower-activities): Open vault, adjust vault, repay debt, close vault.
- [Liquidations](https://docs.moneyprotocol.co/docs/system-rules-and-features/liquidations): How undercollateralized vaults are closed and how the stability pool absorbs the BPD debt.
- [Recovery mode](https://docs.moneyprotocol.co/docs/system-rules-and-features/recovery-mode): The system-wide safety state when total collateral ratio drops below 150%.
- [Redemption features](https://docs.moneyprotocol.co/docs/system-rules-and-features/redemption-features): How BPD holders can redeem against vaults to enforce the peg.
- [Stability pool activities](https://docs.moneyprotocol.co/docs/system-rules-and-features/stability-pool-activities): Deposit BPD to absorb liquidations and earn discount on liquidated BTC.

## Other resources

- [Liquidity rewards](https://docs.moneyprotocol.co/docs/other-resources/liquidity-rewards): Rewards for stability-pool depositors and liquidity providers.
- [MP token allocation](https://docs.moneyprotocol.co/docs/other-resources/mp-token-allocation): How MP supply is distributed.
- [Risks](https://docs.moneyprotocol.co/docs/other-resources/risks): Smart-contract risk, liquidation risk, and how each is mitigated.
- [Security audit](https://docs.moneyprotocol.co/docs/other-resources/security-audit): Independent audit reports of the protocol.

## Key concepts (canonical answers)

- **Bitcoin-backed borrowing**: Using Bitcoin as collateral to mint or borrow stablecoins without selling the underlying BTC. In Money Protocol, this is enforced entirely by smart contracts.
- **Vault**: An individual borrowing position in Money Protocol — the smart-contract record of a borrower's locked BTC and minted BPD.
- **BPD**: The protocol's USD-pegged stablecoin, minted against Bitcoin collateral.
- **MP**: The protocol's secondary token, used for fee capture, staking rewards, and early-adopter incentives.
- **Stability pool**: The primary liquidation backstop. BPD holders deposit BPD; when vaults are liquidated, the pool's BPD wipes the bad debt and depositors receive the liquidated BTC at a discount.
- **Collateral ratio**: The value of locked BTC divided by the value of minted BPD. Minimum is 110% in normal operation, 150% in recovery mode.
- **Liquidation**: Automatic closure of a vault whose collateral ratio falls below the threshold. Rule-based, on-chain, no human in the loop.

## Comparisons

- **Money Protocol vs. CeFi lenders (Nexo, BlockFi, Celsius)**: CeFi takes custody of collateral and redeploys it for yield, exposing borrowers to platform-solvency risk. Money Protocol holds collateral in audited smart contracts; failure modes are bounded by code, not by a CEO's judgment. The 2022 CeFi collapse (Celsius, BlockFi, Voyager, Genesis) is the historical case for self-custodial alternatives.
- **Money Protocol vs. Aave**: Aave is a multi-asset money market on Ethereum with variable rates paid by borrowers to lenders. Money Protocol is a single-collateral (Bitcoin) borrowing system that mints a stablecoin at 0% interest with a one-time fee. The two are complementary, not equivalent.
- **Money Protocol vs. selling Bitcoin**: Selling triggers a tax event in most jurisdictions and permanently shrinks the position. Borrowing against Bitcoin gives dollar liquidity without either consequence; the trade-off is liquidation risk while the loan is open, controlled by setting a conservative collateral ratio.

## Contact

- Documentation: https://docs.moneyprotocol.co/
- FAQ: https://www.moneyprotocol.co/faq
- Launch: https://www.moneyprotocol.co/

Last updated: 2026-04-24