We consider the formation of satellites around the Pluto-Charon binary. An early collision between the two partners likely produced the binary and a narrow ring of debris, out of which arose the moons Styx, Nix, Kerberos and Hydra. How the satellites emerged from the compact ring is uncertain. Here we show that a particle ring spreads from physical collisions and collective gravitational scattering, similar to migration. Around a binary, these processes take place in the reference frames of most circular orbits, akin to circular ones in a Keplerian potential. Ring particles damp to these orbits and avoid destructive collisions. Damping and diffusion also help particles survive dynamical instabilities driven by resonances with the binary. In some situations, particles become trapped near resonances that sweep outward with the tidal evolution of the Pluto-Charon binary. With simple models and numerical experiments, we show how the Pluto-Charon impact ring may have expanded into a broad disk, out of which grew the circumbinary moons. In some scenarios, the ring can spread well beyond the orbit of Hydra, the most distant moon, to form a handful of smaller satellites. If these small moons exist, New Horizons will find them.