Binance Labs, the venture capital and incubation arm of Binance, has invested in Babylon. Babylon is a Bitcoin staking protocol that invented native Bitcoin staking, enabling users to stake bitcoins for PoS blockchains and earn yields without the need for third-party custody, bridge solutions, or wrapping services.
Babylon assures the PoS chains with slashable economic security while guaranteeing effective stake unbonding to increase liquidity for Bitcoin holders.
Constructed utilizing the Cosmos SDK, the Babylon chain has partnered with many Cosmos protocols for the initial testnet phase. Babylon functions as a control plane to maintain synchronization between the Bitcoin network and the PoS chains while offering Bitcoin timestamping services to them. In the end, it serves as a conduit between the PoW world of Bitcoin and the PoS chains by facilitating BTC staking, allowing participation in finality rounds, and tracking validator staking data.
AND. WE’RE. LIVE 🥳
— Babylon (@babylon_chain) February 28, 2024
It’s time to join the Bitcoin Staking Revolution🔶🔒
Babylon Testnet, the first ever Trustless Native Bitcoin Staking protocol, is now officially live!
Get involved, stake Signet #BTC and claim your free Pioneer Pass now.https://t.co/kdBgiu12Fq
👇🧵 pic.twitter.com/l0eZTmZzev
Bitcoin is the world’s largest and most popular pioneering cryptocurrency. The network offers reliable timestamping service, and its blockchain is time-tested and can provide much-needed economic security for PoS chains.
Advantages of using Babylon’s protocol for securing PoS networks:
- The Bitcoin protocol used by Babylon is trustless.
- Babylon’s services do not require any oracles, third-party custody, Bitcoin bridging, or Bitcoin wrapping.
- There are no related counterparty risks with the protocol.
- It allows PoS chains to access Bitcoins millions of dollars worth of staking power.
- Quick Unbonding: PoS blockchains have lengthy unbonding times since they depend on social consensus to fend off long-range attacks. Social consensus is replaced by Bitcoin security, which shortens the time it takes to rebond to a few hours.
- Bootstrapping new protocols: New innovative protocols with low token valuation can be bootstrapped using the security of Bitcoin.
The first PoS chain it secures will be Babylon. Supported PoS features include partial slashing, on-demand unstaking, and stake delegation. Bitcoin restaking onto other PoS chains will eventually use the Babylon PoS chain as their marketplace and control plane.
Bitcoin timestamping service will be accessible to all dApps developed on the Babylon PoS chain and any chain that is IBC-compatible (inter-blockchain communication).
For safe Bitcoin restaking, this service is a cross-chain time-synchronization primitive. It can also shorten the native stake unbonding time of PoS systems from weeks to a single day, protecting them from long-range attacks.
How it works?
BTC staker locks bitcoins in a self-custodian vault and starts the process by sending a staking transaction to the Bitcoin network. More precisely, it generates a unique token exchange offering (UTXO) with two spending requirements: 1) a timelock that allows the staker to withdraw using the secret key, and 2) burning of this UTXO using a unique extractable one-time signature (EOTS). In the event of delegation, the stake delegates this EOTS to the validator.
In case of good behaviour, the staker extracts yield by adhering to the rules. The staker then has two options for unbonding: either submit an unbonding transaction to Bitcoin, which will release the bitcoin after a specified unbonding period, or wait for the current time clock to expire before withdrawing.
If the staker or validator displays bad behaviour such as double-spending attacks on the PoS chain, then the staking protocol guarantees that the staker’s EOTS secret key is made public. As such, anyone can pretend to be the staker in order to burn BTC and submit a slashing transaction on the currency chain. This slashing route guarantees that safety infractions are held accountable, upholding the system’s general integrity.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
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