A prominent cryptocurrency exchange has introduced Bitcoin (BTC) staking via a collaboration with the Babylon Bitcoin staking protocol. This new feature allows clients to earn passive rewards on their BTC holdings without needing to bridge, wrap, or lend their assets.
Starting today, clients using this exchange can stake their Bitcoin directly through the Babylon protocol. The BTC is secured within a vault on the Bitcoin main chain and is then delegated to safeguard Proof of Stake (PoS) networks through Babylon. The rewards earned from staking Bitcoin will be paid out in BABY, the native token for Babylon Genesis, which is recognized as the first layer-one network enhanced by Bitcoin.
The Global Head of Consumer at the exchange noted that a significant amount of Bitcoin has remained idle on their platform, highlighting a missed opportunity for clients and the overall ecosystem. With this new staking option, clients can now generate returns on their BTC while allowing emerging PoS blockchains to leverage Bitcoin’s economic influence for transaction validation and network security.
The integration with Babylon’s Bitcoin staking protocol demonstrates how trust-minimized staking can function effectively at scale. By anchoring the staked Bitcoin directly on its native blockchain and delegating it to PoS networks, clients can earn staking rewards without the need for bridges or wrappers, thus maintaining Bitcoin’s robust security and sovereignty. This initiative aims to channel Bitcoin’s economic strength into supporting the next generation of PoS ecosystems and is seen as a significant advancement towards establishing a Bitcoin-native decentralized finance (DeFi) environment.
Significantly, holders’ staked BTC stays within the Bitcoin blockchain. The staking process operates under Bitcoin scripts, while the management of staking rewards is performed through on-chain logic on Babylon Genesis, enabling verification by users and independent third parties. The staking mechanism also includes cryptographic protections designed to address and penalize any malicious activities. Individuals can choose to unstake their BTC at any moment, although a seven-day unbonding period is required before the funds can be withdrawn.
This BTC staking service is now accessible across various interfaces of the exchange platform, including both the regular and professional versions. With this launch, clients have a new opportunity to enhance their Bitcoin holdings effectively while contributing to the growing ecosystem of PoS networks.