The cryptocurrency exchange Kraken has launched a new Bitcoin staking product through an integration with the staking protocol Babylon Labs.
In a Thursday announcement, the cryptocurrency exchange Kraken revealed its collaboration with the Bitcoin (BTC) staking protocol Babylon. Through this integration, Kraken users can earn yields from their Bitcoin holdings without the need for cross-chain, wrapping, or lending.
Starting today, Kraken customers can use the service by staking Bitcoin without interacting with an off-chain wallet. The Bitcoin will be locked in a vault on the Bitcoin blockchain and delegated to a proof-of-stake (PoS) network through the Babylon protocol for security.
Rewards are not paid in Bitcoin; users will earn Babylon's BABY tokens. According to CoinMarketCap, the price of BABY has risen nearly 5% since the announcement.
Mark Greenberg, Head of Global Consumer Business at Kraken, stated, "There is currently a significant amount of Bitcoin sitting idle on our exchange." He believes that these idle assets represent a "huge opportunity cost" for customers and a missed opportunity for the broader ecosystem.
With the integration with Babylon, Greenberg noted that customers can now earn returns on their Bitcoin. He also emphasized the additional benefit of "allowing emerging PoS blockchains to leverage the economic weight of Bitcoin to validate transactions and enhance the security of their networks."
BTCFi refers to financial projects built on Bitcoin. One of the earliest developments in this area is arguably Omni Layer, launched on July 31, 2013, which was the only way to move Tether (USDT) until Ethereum emerged.
Nevertheless, BTCFi mainly refers to recent projects like Babylon. Babylon is a network secured by Bitcoin that allows Bitcoin holders to natively stake BTC without wrapping or cross-chain, while maintaining control over their assets to secure the PoS blockchain.
Staking is conducted through time-locked scripts without intermediaries. Rewards come from an annual inflation rate of 8%, with 4% allocated to BTC stakers and 4% to BABY stakers. BABY can be used to pay transaction fees and allows holders to vote on protocol changes.
Other examples of BTCFi include the second-layer blockchain built on Bitcoin Stacks, the Bitcoin sidechain Rootstock compatible with the Ethereum Virtual Machine, and the Liquid Network, along with the scalability solution Lightning Network paired with the tokenization layer Taproot Assets.
Reports from early Q1 2025 indicate a sharp increase in network security and mining participation for the smart contract platform Rootstock. Research released by the cryptocurrency exchange Binance in April showed that the value locked in Bitcoin-based decentralized finance surged over 2700% in the past year.
Brendon Sedo, an initial contributor to Core DAO, stated in March that due to the rise of BTCFi, Bitcoin is surpassing the narrative of "digital gold."
Related: Norwegian crypto company K33 raises more funds to purchase up to 1,000 Bitcoin (BTC)
Original article: “Kraken Partners with Babylon to Launch Bitcoin (BTC) Staking Service”
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
