dAPP
Published on 
4 June, 2025

Coverage and Stability

When people talk about DeFi protocols, many think of yield, leverage, or stablecoin issuance. But there's a fundamental concept that often goes unnoticed, and at Money On Chain, it’s absolutely essential: coverage.

In this article, we’ll explain global coverage, how it’s calculated, and why it’s the central factor keeping DOC stable, protecting BPRO holders, and allowing the protocol to function without automatic liquidations, even in extreme scenarios.

What Is Global Coverage?

Global coverage is the ratio between the value of the collateral locked in the protocol (in BTC) and the amount of DOC issued. It’s expressed as a proportion, for example, coverage of 4 means there are four times more BTC locked than DOC circulating.

Simple formula:
Global Coverage = Total Value of BPRO (in BTC) / Total Value of DOC Issued (in BTC)

This metric shows how the protocol maintains DOC’s peg to the dollar without relying on a centralized custodian or forced liquidations.

Why Is It So Important?

Coverage is what gives real backing to DOC. As long as that coverage remains above certain thresholds, the system stays healthy, and users can:

  • Mint and redeem DOC without issues
  • Mint BPRO with their BTC
  • Trust that DOC will hold its value

When coverage drops, the protocol automatically protects itself by restricting certain actions without liquidating positions. That’s key.

The Protected Mode and Incentive System

One of Money On Chain’s biggest differentiators is its Non-Liquidation approach. Instead of liquidating collateral like other protocols, it implements progressive defense mechanisms:

Coverage LevelProtocol StatusAllowed Actions
>4NormalAll operations enabled
2 to 4RestrictedCannot redeem BPRO or mint DOC
<2Incentives ActiveCan mint BPRO at a discount
<1.5Protected ModeDOC redemption disabled
<1Governance AlertMoC holders may vote for liquidation

This system is designed to withstand extreme events, like sharp Bitcoin price drops—known as flash crashes. If you're interested in this topic, check out the article What if Bitcoin had a flash crash?.

The system has consistently maintained a global coverage well above 4 in recent years. Even when Bitcoin dropped from a peak of ~$64K to $15K in just a few months, the protocol stayed healthy and never entered Protected Mode.

How Is Coverage Adjusted?

Coverage adjusts automatically based on user activity and the price of Bitcoin.

  • When more people mint DOC, coverage decreases, increasing leverage.
  • This triggers incentives for users to provide more collateral (BPRO).
  • If BTC’s price rises, coverage improves; if it drops, defense mechanisms activate once coverage falls below 4.

This logic aligns incentives:
Users who want DOC must trust that BPRO hodlers will keep their BTC in the protocol. BPRO holders benefit from offering this liquidity as long as the system remains well-covered.

Where Can I Monitor Coverage?

You can track global coverage directly from the Money On Chain dapp. It’s one of the most important indicators for understanding the protocol’s health and making informed decisions.

Key Takeaways on Coverage

Global coverage is much more than a technical metric. It’s the cornerstone of the Money On Chain model. Thanks to its robust design and the coordinated participation of its users, the protocol has maintained DOC stability since 2019, without relying on aggressive liquidations or centralized custodians.

The right incentives and a community that understands its importance make this decentralized, antifragile system possible.

Want to Learn More?

Read Deep Dive into Money On Chain 

Explore MoC Token Explained to understand how governance strengthens this architecture.

Do you hold DOC or BPRO? Track the coverage and take an active role in a protocol that puts Bitcoin at the center.

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