The protocol features satUSD, a stablecoin pegged to the US dollar, and OSHI, a utility token rewarding ecosystem participants. Users generate liquidity by minting satUSD with collateral, maintaining a minimum 110% ratio, and can redeem satUSD through a structured mechanism to preserve its stable value.

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The Satoshi Protocol is a significant advancement in Bitcoin DeFi, enabling holders to access liquidity without unpredictable interest payments. It enhances Bitcoin's utility by promoting spendability and operates as a multichain protocol, allowing its stablecoin satUSD to circulate across different blockchain ecosystems, including the Bitcoin mainnet, thus enhancing interoperability.

The protocol's core components are satUSD, a stablecoin pegged to the US dollar, and OSHI, a utility token rewarding ecosystem participants. Users mint satUSD by collateralizing Bitcoin and other assets, maintaining a minimum 110% collateral ratio.
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This process facilitates liquidity generation and enables satUSD holders to redeem collateral through a structured mechanism, ensuring satUSD's stable value.

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$satUSD is a Bitcoin-backed, over-collateralized stablecoin pegged to $1 USD. It allows users to deposit collateral at a 110% collateral ratio to mint satUSD or perform 1:1 exchanges with USDC/USDT.

With its instant liquidation module and peg mechanism, satUSD ensures the stability of the protocol. When the price drops below $1, arbitragers can profit by redeeming satUSD. Conversely, when the price exceeds $1.1, users can mint satUSD by collateralizing BTC and selling it on the market.

The Satoshi Protocol’s design guarantees continuous over-collateralization, optimizing capital efficiency. satUSD can be used in various DeFi activities, including providing liquidity on DEXs, earning interest on lending, and participating in other BTCFi opportunities.

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satUSD is designed to unlock Bitcoin’s liquidity, fulfilling its dual roles as both digital gold and a functional payment mechanism.

• Bitcoin Integration: satUSD leverages Bitcoin as one of its collateral options, tapping into Bitcoin's vast market capitalization and reinforcing Bitcoin's role within the DeFi ecosystem.
• Decentralization: satUSD provides a decentralized stablecoin alternative, reducing the dependency on centralized financial entities and mitigating associated risks.
• Broad Potential: Compared to alternatives like DAI and LUSD, satUSD has a wider potential for adoption and utility, thanks to Bitcoin's larger market cap and established presence across Bitcoin L2 solutions and ERC-20 compatible platforms.

By doing so, the protocol not only reinforces Bitcoin’s position in the digital economy but also expands its usability and accessibility.

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The Stability Pool (SP) serves as a crucial mechanism within the Satoshi Protocol, designed to preserve the system's stability by providing liquidity for settling debts from liquidated Positions.
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When a Position undergoes liquidation, the SP uses satUSD to clear the debt and, in return, acquires the collateral from the liquidated Position.
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Users can deposit BTC and other assets as collateral to mint the stablecoin satUSD. To create a position, follow these steps:
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1. Visit the Position page at Satoshi Protocol Position Page.
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2. Click on "Create Position." Deposit BTC and borrow satUSD, making sure the collateral ratio remains above 110% and that you borrow a minimum of 18 satUSD.
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3. Click "Approve" and then confirm the transaction in your wallet. Once approved, click "Create Position."
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satUSD maintains its peg to the USD through both "hard" and "soft" mechanisms:

• Hard Peg: The fundamental anchor comes from satUSD's redeemability for collateral. This ensures that satUSD always has a tangible price floor.
• Soft Peg: The soft peg mechanism for satUSD's price stability is intricately linked to its Minimum Collateral Ratio (MCR) of 110%. This design ensures that when satUSD's market value exceeds $1.10, participants are incentivized to deposit collateral, mint satUSD with a collateral ratio set at 110%, and sell the minted satUSD in the market. This arbitrage opportunity inherently stabilizes satUSD's price by increasing its supply when its price climbs above the target, thereby aligning satUSD's market price closely with the USD. By leveraging these market dynamics, the protocol effectively maintains satUSDs value within the desired range, ensuring its stability and reliability as a stablecoin.

Through these mechanisms, the Satoshi Protocol aims to maintain the satUSD stablecoin's price stability, ensuring it remains a reliable and functional token.

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