Ducat, a Bitcoin L1 credit and stablecoin protocol, has been selected as an incubatee of CMC Labs, CoinMarketCap’s Web3 accelerator.
CoinMarketCap has selected Ducat as an incubatee of CMC Labs, its Web3 accelerator program. Ducat is a credit and stablecoin protocol built on Bitcoin’s base layer. Holders borrow a dollar-pegged stablecoin against their Bitcoin (BTC) without moving it onto another chain or handing it to a custodian.
The program connects selected startups with CoinMarketCap’s audience and its network of accelerator partners ahead of significant milestones. For Ducat, the timing lines up with a mainnet launch and a token generation event expected later in the year.
Rush, CEO of CoinMarketCap, said: “We support Ducat’s approach to expanding Bitcoin-native financial infrastructure by enabling BTC holders to access dollar-pegged liquidity directly on the base layer.”
How Ducat Works
A Ducat loan starts with a vault. The borrower locks BTC into a Taproot vault that requires the user’s key and a protocol-controlled guardian key. The guardian key is produced collectively by a decentralized set of Guardian co-signers using FROST threshold signatures, so no single Guardian can move funds alone. The borrower then receives a dollar-pegged stablecoin against the collateral and picks the denomination at the outset: UNIT, Ducat’s Bitcoin-native stablecoin, or USDC (USDC).
A key distinction is where the loan logic resides. A vault’s terms and its liquidation conditions are recorded on Bitcoin and enforced by Bitcoin Script, rather than by a smart contract chain or an outside party. A vault can be settled in only two ways. The borrower repays and redeems their BTC, or the position falls below its threshold and is liquidated. Redemption settles in a single Bitcoin block, with no withdrawal queue.
Vaults open at 160% collateralization and become eligible for liquidation at 135%. The origination fee is 1%, charged once, and there is no ongoing interest, which Ducat says makes the model Sharia-compliant. Liquidations are permissionless, meaning any Bitcoin network participant can recapitalize an undercollateralized vault and acquire its BTC at a discount once it falls below the liquidation threshold.
A Passive Oracle and a Cryptographic Counterparty
Pricing comes from a Bitcoin-native oracle that Ducat built together with Chainlink. At vault creation, Chainlink commits a hash to the vault’s on-chain record, then monitors the BTC/USD price. If the price reaches the liquidation level agreed at the start, Chainlink reveals the matching pre-image, which makes the liquidation path valid. The oracle only ever publishes data. It does not sign transactions and cannot move funds.
The co-signing group, which Ducat calls Guardians, uses FROST threshold signatures. Guardians check each transaction against the protocol’s on-chain rule set before adding their signature, and they verify prices against a second feed. They cannot redirect BTC or change the loan terms. The BTC cannot be stolen, rehypothecated, or moved without the borrower’s signature. Guardians only provide the protocol co-signature required to process valid vault actions.
Testnet Traction
Ducat opened its testnet in summer 2025 and as of April, more than $700 million in testnet BTC had been vaulted and over $300 million in UNIT borrowed, across roughly 60,000 users and around four million transactions. Bitcoin is one of the largest potential collateral markets in the world. Roughly $1.5T of BTC exists, yet less than 1% is active in lending. Ducat is designed to let users borrow against Bitcoin without selling, wrapping, or giving up custody of their BTC.
What the Incubation Covers
Through CMC Labs, Ducat will work with CoinMarketCap on educational and informational content ahead of mainnet. That includes editorial coverage, social content, and community campaigns.
“Bitcoin holders should not have to choose between accessing liquidity and giving up control of their BTC,” said David Evans, founder of Ducat. “Ducat was built to make Bitcoin usable as collateral without wrapping it, moving it to another chain, or trusting a lender to hold it. Partnering with CMC Labs helps us bring that message to a much wider audience as we move towards mainnet.”
About Ducat
Ducat is a Bitcoin L1-native credit and stablecoin protocol. BTC holders deposit Bitcoin into a 2-of-2 Taproot vault and borrow a dollar-pegged stablecoin, either UNIT or USDC, against it, with all loan logic enforced on Bitcoin. More information is available at ducatprotocol.com.
About CMC Labs
CMC Labs is CoinMarketCap’s Web3 accelerator program. It supports selected crypto startups with visibility and access to CoinMarketCap’s partner network.
(CMC Labs: Partnership)
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