> For the complete documentation index, see [llms.txt](https://docs.embrprotocol.org/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.embrprotocol.org/technical/protocol-mechanics.md).

# Protocol Mechanics

<figure><img src="/files/uDKbPwmFpZ64qNFncSIa" alt=""><figcaption><p>Flowchart of fees, inflows, and outflows on EMBR</p></figcaption></figure>

## TL;DR:

* User deposits BTC.b into a Trove
* Collateral ratio can be at minimum 110% in  and taken in $ESC (a USD pegged stable coin)
* 0% interest rate, pay back loan at any time
* Peg Defense
  * Stake ESC in stability pool to earn BTC.b from liquidated positions & EMBR
    * Staked $ESC is used to rebalance Troves when liquidated, taking $ESC from the stability pool and dispersing BTC.b back to Stability Pool stakers
  * Redeem $1 in BTC.b at any time with 1 $ESC, will be unprofitable when 1 ESC > $1
* Stake EMBR to earn borrowing & redemption fees


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