What is a Self Repaying Mortgage (SRM)?
The Bitcoin Self-Repaying Mortgage (SRM) is part of the People’s Reserve Bitcoin-Powered Mortgage (BPM) line.
It is designed to reduce and in many cases fully repay mortgage debt over time by combining:
Bitcoin collateral performance
A variable interest-rate model
Home Equity Contribution (HEC) cash flow
Loyalty-based repayment advantages
Unlike traditional mortgages or crypto-backed loans, the SRM is designed to adapt to market conditions instead of breaking under them.
Why is it called a “Self Repaying” Mortgage?
The SRM earns its name because repayment improves automatically as conditions improve:
Bitcoin appreciation reduces interest rates
HEC generates cash flow applied to the mortgage
Loyalty Levels amplify repayment benefits
Over time, these forces work together to reduce required monthly payments and accelerate payoff.
How is this different from other Bitcoin-backed loans?
Traditional Bitcoin loans rely on margin calls and liquidation.
If Bitcoin’s price drops sharply:
Borrowers must post more collateral
Failure to do so results in liquidation
Bitcoin savings can be permanently lost during short-term crashes
The SRM is designed specifically to eliminate this liquidation risk.
What happens if Bitcoin crashes sharply (like during COVID)?
This scenario is explicitly addressed in the SRM design.
Using the COVID crash as an example:
Bitcoin dropped roughly 50% in a very short time
Traditional borrowers were liquidated overnight
Many lost Bitcoin permanently, even though price recovered soon after
Under the SRM model:
No liquidation occurs
No forced selling of Bitcoin
Instead, the interest rate temporarily adjusts upward
For every 10% Bitcoin price decline, the interest rate increases modestly.
This results in slightly higher payments for a short period, not loss of assets.
When Bitcoin recovers:
Interest rates return to prior levels
Monthly payments normalize
Does a price drop increase my payments?
Yes temporarily, but in a controlled way.
If Bitcoin becomes under-collateralized:
Interest rates increase incrementally
Monthly payments may rise for a short period
This adjustment replaces margin calls and liquidation, allowing borrowers to ride out volatility instead of being wiped out by it.
What happens when Bitcoin recovers or reaches new highs?
As Bitcoin appreciates:
Interest rates automatically decrease
Monthly mortgage payments decline
Over-collateralization can reduce rates by multiple percentage points
In strong market conditions, borrowers may see meaningfully lower payments than when the mortgage was initiated.
Can my mortgage payment actually go down over time?
Yes this is a core feature.
Payments can decrease due to:
Bitcoin appreciation improving collateral ratios
Interest rates stepping down as price rises
HEC cash flow offsetting principal
Loyalty Level enhancements
This is the opposite of traditional mortgages, where payments are fixed and interest-heavy for decades.
Is my Bitcoin ever sold or liquidated?
No.
Bitcoin is posted as collateral, not spent
There are no margin calls
There is no forced liquidation during volatility
The SRM is designed so borrowers do not lose their Bitcoin due to short-term price movements.
Do I still own my home?
Yes.
You retain full legal ownership of your property at all times.
The SRM does not transfer title or ownership rights.
What is the Home Equity Contribution (HEC)?
The Home Equity Contribution (HEC) activates when your property is claimed within the People’s Reserve ecosystem.
Your property becomes eligible for RWA funding reserves
These reserves generate monthly cash flow
That cash flow is applied directly to your mortgage
This further reduces your out-of-pocket payments.
How does my Loyalty Level affect the SRM?
Your Loyalty Level (PRN holdings) influences:
The strength of HEC contributions
The speed of repayment benefits
Overall mortgage efficiency
Higher Loyalty Levels unlock greater repayment advantages over time.
Is the SRM risk-free?
No financial product is risk-free.
While the SRM is designed to remove liquidation risk and reduce traditional mortgage stress:
Bitcoin is still volatile
Benefits depend on market performance
Results vary by collateral, timing, and Loyalty Level
The system prioritizes resilience and survivability, not short-term speculation.
Why does this model matter?
Traditional mortgages lock borrowers into:
Fixed payments
Front-loaded interest
No upside participation
The SRM flips that model by allowing:
Bitcoin appreciation to reduce debt
Property equity to generate contributions
Interest rates to move in the borrower’s favor
Instead of being punished by volatility, borrowers are designed to withstand it and recover with it.