The wBTC borrow market is in the low billions across Aave, Morpho, and Maker. Average rate: ~4.5%. Annual cost to borrowers: ~$45M+. On BSD at 0.1%, the same book would cost ~$1M. $44M+ of spread per year — extracted by the EVM ecosystem, not paid to Bitcoin holders. 😭

BlackRock: sell your BTC upside for income. BSD: borrow against your BTC at 0% and keep the upside. Both produce dollars. Only one keeps the asset that compounds.

🧵 A quick primer on BSD's peg: BSD trades at $1 not because someone defends the peg — but because the math rewards/punishes anyone who lets it drift for too long. Below $1: I can buy 1 BSD for $0.99 and redeem it for $1.00 of sBTC. The protocol burns my BSD and pays me out. Arbitrage closes the gap. Above $1: I open a vault, mint 1 BSD against my BTC, sell it for $1.01. The supply expands and price returns to $1. The lowest-rate vaults get redeemed first. Set a higher rate = more redemption protection. Set a lower rate = cheaper loan, but you're earlier in line. The borrower picks the tradeoff. No votes. No central peg manager. Just two arbitrage paths and a redemption queue proven by years of running on Bold/Liquity.

"BTC-backed synthetic dollars can't work." We hear three versions of this. Let's walk through each one. 👇 1. “BTC is too volatile for collateral” BSD requires 110% collateral ratio. If BTC drops, the protocol has automatic liquidation + a stability pool that absorbs undercollateralized vaults. Same mechanism Liquity battle-tested on Ethereum since 2021. It's not theory — it's been through every crash since. 2. “Stacks is too small” Stacks just posted two-year highs in transaction volume, active accounts, and contract deployments. Zest hit 700 BTC deployed. Bitflow crossed $160M+ volume. The liquidity isn't hypothetical — it's measurably growing every quarter. 3. “No CEX listings. How do I exit?” BSD is redeemable for BTC collateral at any time, at face value. That's not a CEX listing — it's better. Your exit is protocol-guaranteed, not exchange-dependent. Redemption is the peg mechanism, not a convenience feature. The objections assume BTC-backed assets work like everything else in DeFi. They don't. The collateral is the hardest money on earth. The contracts are immutable. The mechanism is proven.

Most platforms choose rates. BSD borrowers set their own interest rates. Pick a higher rate = more protection from redemption. Pick a lower rate = cheaper loan but you're earlier in line if someone redeems.

New study (moneyforai.org) shows frontier AI agents, unprompted, converge on two-tier money: Bitcoin dominates store-of-value (79.1% across models), stablecoins lead medium-of-exchange (53.2%). Agents want BTC long-term but need dollar-stable spending.

BSD Stability Pool 🧵 The Stability Pool enables responsive liquidations. Deposit BSD to earn sBTC from liquidated vaults. Liquidations trigger when a vault’s collateral ratio falls below 110%. The pool burns BSD to cancel the debt, and depositors receive the sBTC collateral—typically yielding a ~10% gain per liquidation event. The chart reveals why timing is critical: deposit too early and your capital sits idle → poor APY. Deposit just before heavy liquidations and your BSD gets fully utilized → strong APY. As the red/orange bars (at-risk debt) rise toward the teal line (pool size), the probability of profitable liquidations is increasing. More info on Stability Pool here: docs.bsd.money/protocol/stab…

BSD Protocol - Frequently Asked Questions 👇 Last week was redeem basics. This week redeem advanced FAQs: 🙋‍♂️ What happens if my vault is redeemed against? You can think of a redemption against your vault as someone else repaying your debt in exchange for an equal value of your collateral. BSD will be consumed from your vault to fulfill the redemption, and your debt will be reduced accordingly. You will lose some of your sBTC collateral, but this improves your vault’s collateral ratio. The downside is that you lose exposure to the sBTC that was redeemed from your vault. 🧮 Do I lose money if my vault is chosen for redemption? You do not incur a direct net loss in dollar terms at the time of redemption. The value of the collateral you lose is equal to the value of the debt that is paid off for you. However, you do lose your position in that sBTC, meaning you miss out on any of its potential future price increases. ⚖️ What is the difference between a partial and a full redemption of my vault? A partial redemption occurs when the redemption amount is less than your vault's total debt. Only a portion of your debt is cleared, and a corresponding amount of sBTC is taken. A full redemption occurs when the redemption clears all of your vault's remaining debt. If the redemption amount is larger than your debt, the process continues to the next vault in the queue until the full redemption is complete.

BSD Protocol - Frequently Asked Questions 👇 This week focuses on redemptions: ⚖️ Why does the redemption feature exist? The redemption mechanism exists to help BSD maintain its price peg to the dollar. It creates a price floor and ceiling through arbitrage opportunities: If BSD trades below 1 USD, it is profitable for users to buy BSD on the open market and redeem it through the protocol for 1 USD worth of sBTC. This activity reduces the supply of BSD, pushing its price up toward 1 USD. If BSD trades above 1 USD, it is profitable for users to borrow BSD and sell it. This increases the supply of BSD and pushes the price down toward 1 USD. ↩️ Redemptions vs. loan repayment? Same thing? Paying back your debt is not the same as a redemption. Repayment is a specific user repaying debt for their own specific vault. Redemption is an open mechanism available to anyone holding BSD and in our private beta. When you redeem, you are exchanging BSD for sBTC from an unspecified vault (or vaults) that the protocol selects based on having the lowest interest rates. 🎛️ How does the protocol decide which vault to redeem from? The protocol targets vaults with the lowest user-set interest rates (APY) first. Vaults in the system are always sorted from lowest to highest APY to facilitate this process.

The secret to BSD: BSD is THE cheapest, most capital-efficient, and most flexible Bitcoin-backed loan in existence. This protocol is THE final, best design for Bitcoin-backed credit and dollars. We will never compromise on those pillars.

BSD Protocol - Frequently Asked Questions 👇 💰 Why borrow BSD? When you borrow BSD you’re utilizing the liquid value of your Bitcoin without selling. In practice there are a few common reasons why Bitcoin holders typically do this: – Use BSD to buy other digital or real world assets. – Sell BSD to buy more Bitcoin (leverage). This can be risky and we do not recommend it. – Secure BSD by providing BSD to the Stability Pool in exchange for rewards. 🔁 What is sBTC? How can I get some? sBTC is a programmable form of Bitcoin that serves as collateral within the BSD Protocol on the Stacks blockchain. The easiest way to get sBTC is to migrate some L1 BTC here: app.stacks.co/ 🔒 How is my collateral secured? sBTC secures your collateral via a network of industry leading institutional validators. These signers are responsible for approving all sBTC deposit and withdrawal operations, ensuring the integrity of the system.