Ankr BTC Liquid Staking: Everything You Need To Know

Last week, Ankr announced our instrumental role in launching the first bitcoin staking solution with the Babylon protocol. For the first time, this offers a way for BTC holders to earn yield on their assets without taking them away from the safety of the bitcoin blockchain.

Let’s dive into everything you need to know about bitcoin staking, when it will be live, and more.

What Is the Babylon Protocol?

The power of 21 million BTC is a force to be reckoned with. Its use as a store of value and P2P payment mechanism is unquestionable now. But how can we give the trillion-dollar market cap of BTC new utility other than sitting idle in so many accounts?

This is the question that Babylon answers in the following ways:

Learn more about Babylon

Offering Secure Yield for BTC Holders

Ankr Co-founder Ryan Fang speaking at Bitcoin Renaissance

The Babylon protocol enables bitcoin holders to earn yields from their idle bitcoins in a secure way: no third-party trust, no bitcoin bridging to any other chain. Bitcoin holders simply lock their bitcoins in a self-custodial way to gain the rights to validate PoS chains and earn yields in return. Powered by the fast unbonding and scalable restaking features of the protocol, bitcoin stakers can also enjoy maximal liquidity and yields.

Providing Shared Security for Web3 Chains

Source: Babylon

A difficult challenge in starting a new blockchain ecosystem is gaining enough staked capital to secure it. Protocols like Eigen Layer allow any new project to avoid bootstrapping its own cryptoeconomic security (staked tokens) by sharing access to the Ethereum staked capital base and decentralized validator set. But now Babylon offers developers the chance to tap into a store of capital far greater than even Ethereum can offer – 21M BTC that can be used to secure all chains participating in Babylon’s protocol.

Creating Institutional Opportunities

Source: Bitcoin.com

Crypto custodians, exchanges, ETFs, and governments hold many billions of dollars in bitcoin. In the future, it is very likely that they will be looking for solutions like bitcoin staking to boost yields and offer returns for their users. If they choose to stake with protocols like Babylon, it would create a massive influx of BTC to secure Web3 networks.

What is Ankr’s Bitcoin Liquid Staking Solution for Babylon?

Ankr has collaborated with Babylon to provide our expertise in creating liquid staking tokens (LSTs) for the bitcoin staked via Babylon. The LSTs will then be issued on PoS chains secured by the BTC staking protocol.

How it works:

• BTC holders elect to stake their bitcoin via Ankr Liquid Staking.
• The users will earn staking rewards on their locked BTC via the Babylon protocol.
• Stakers can choose to unstake and unlock their BTC at any time.

As Babylon finalizes its protocol mechanics and enters its live network's launch, Ankr will update our community on how exactly this process will work at every step.

How Will BTC Staking Change the Game for Web3?

Being able to use the value of bitcoin to secure Proof-of-Stake networks is a massive victory for the scalability of new blockchain networks that are a part of Web3. It will become a core piece of scaling via modularity as more and more blockchains launch to assist in the exponential scaling of Web3 using important components such as the Data Availability layers of Babylon and Eigen Layer.

When Will BTC Staking Be Live?

The Babylon protocol is now in its testnet phase, the mainnet is slated to be launched later in 2024. The Ankr team will provide continual updates to the community on when they’ll be able to stake their BTC.

Final Thoughts

As we find new ways to improve the capital efficiency of crypto, we are creating a digital economy that is many times stronger and more scalable. Ankr’s integration with Babylon is only one piece of our product work for the bitcoin chain, alongside our Bitcoin RPC and other upcoming announcements. Stay tuned for more updates!

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