Unlocking Babylon Chain: Revolutionizing Blockchains with Bitcoin Staking

By  Pratik April 3, 2024

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Introduction

Proof-of-Stake (PoS) chains have long been hailed as the next evolution in blockchain technology, offering increased efficiency and scalability over traditional Proof-of-Work (PoW) systems. However, one of the primary challenges facing PoS chains is ensuring security without the need for extensive capital investment. On the other hand, Bitcoin—a PoW chain–has a market capitalization of $1.35 trillion, and most of its capital remains idle.

This is where Babylon Chain emerges as a pioneering solution. It leverages Bitcoin's vast reserves to bolster the security of PoS chains through a novel staking protocol.

The Concept of Babylon Chain

Babylon seeks to bridge the gap between Bitcoin and PoS chains, enabling Bitcoin holders to stake their idle coins to increase the security of PoS chains and earn rewards in the process. This innovative approach aligns with the vision of a decentralized economy where Bitcoin and PoS chains coexist harmoniously.

How Does it Work

Built upon the Cosmos SDK, Babylon Chain offers two main things: it helps PoS chains with Bitcoin timestamping, and it acts as a sort of coordinator between Bitcoin and PoS networks. Now, what's timestamping you might ask?

Well, timestamping in cryptocurrency refers to the process of recording the exact time when a transaction or piece of data is created or added to the blockchain. It's like putting a digital timestamp on something to show when it happened.

The protocol allows stakers to quickly remove their stakes, which helps them access their funds faster – a feature that stands out from many PoS networks. Moreover, its modular design ensures seamless integration with diverse consensus algorithms, thereby establishing a flexible framework for scalable deployment across multiple chains.

Now that we understand the core architecture of the protocol, let's take a closer look at some of its standout features:

Unique Properties of the Staking Protocol

Babylon's staking protocol boasts three fundamental security properties:

  1. Fully Slashable PoS Security: In the event of a safety breach, one-third of the staked Bitcoin is subject to slashing. However, as long as two-thirds of the Bitcoin stake adheres to the PoS protocol, the chain remains operational.
  2. Staker Security: Every Bitcoin staker is guaranteed the ability to withdraw their funds, known as "unbonding," as long as they follow the Proof-of-Stake protocol.
  3. Quick Unstaking: Similar to what we discussed earlier, the protocol guarantees secure and swift withdrawal of staked bitcoins, eliminating the need for social consensus.

Babylon has already garnered substantial support, with over 101.5K participants engaging in their Testnet staking protocol. So, let's check how the staking process works!

Source:Babylon Chain Source: Babylon Chain

How to Stake Bitcoin on Babylon?

Before we begin, make sure you have the Keplr wallet, which can be downloaded from their website . Remember to opt for the desktop version, as BTC staking is currently supported on desktop platforms only.

Step 1: Set Up Babylon Testnet

  • Go to chains.Kepler.app and search for the Babylon testnet
  • Add the Babylon testnet to your Kepler wallet
  • Enable chain visibility for Babylon testnet in your wallet settings

Step 2: Obtain Babylon Testnet Tokens

  • Copy your wallet address from Kepler
  • Join the Discord server associated with the Babylon platform
  • Select the tech role to access the faucet channel
  • Submit your wallet address in the faucet channel to receive Babylon testnet tokens

Step 3: Install OKEx Wallet

Step 4: Add Signet BTC Token

  • In OKEx wallet, go to manage crypto and search for Sbtc.
  • Add the Signet BTC token to your wallet.

Step 5: Obtain Signet BTC Tokens

  • Copy your Signet BTC wallet address
  • Visit the Signet Faucet website & paste your wallet address
  • Fill out the captcha and submit to receive Signet BTC tokens

Step 6: Start BTC Staking on Babylon Testnet

  • Head to Babylon's BTC staking portal
  • Connect your OKEx and Kepler wallets
  • Select Babylon as the proof of stake chain
  • Choose the finality provider & input the amount of BTC to stake
  • Accept the terms and preview the transaction
  • Confirm five different transactions to stake your bitcoins

Step 7: Wait for Confirmation

  • Your stake will be in a pending state until it receives seven Bitcoin block confirmations
  • Once confirmed, your stake status will change to active, and voila! You have now successfully staked your Bitcoins!

Now that we've covered most of the technical aspects of the project, let's explore the fundamentals that set Babylon apart from others.

Expert Team and Solid Partners

Babylon Chain's success rests on the expertise of its team, which comprises consensus protocol researchers and seasoned Layer-1 engineers. The foundation team, spearheaded by David Tse and Mingchao Yu, boasts extensive expertise in blockchain systems and decades of collective experience in the field.

Partners

In its ecosystem, Babylon proudly hosts an impressive array of industry leaders, encompassing a diverse range of sectors such as DeFi protocols, NFT, and gaming Dapps. With over ten esteemed partners, the platform collaborates with renowned names like Akash Network, SEI, Juno, and Injective, among others.

Strategic Investments by Top VCs

In December 2023, Babylon Chain raised $18 million in a Series A funding round . The round was co-led by prominent players in the crypto space, like Polychain Capital and Hack VC, with other investors including Polygon MATIC Ventures, OKX Ventures, and others.

Additionally, in February of this year, Babylon secured undisclosed investments from Binance Labs – the premier investment arm of the Binance exchange. By securing backing from a leading crypto exchange, Babylon has gained crucial support in its mission to revolutionize the integration of Bitcoin and PoS economies.

Conclusion

In summary, Babylon Chain introduces a new and important use case for the Bitcoin asset: staking to provide security to the PoS world. By demonstrating that bridging Bitcoin assets to other chains will become redundant and unnecessary, Babylon's unique staking protocol becomes the premier platform, offering full economic security to PoS chains. Now, with robust security, strategic partnerships, and a dedicated team, the question of whether Babylon will emerge as the top choice for Bitcoin holders—is something that only time will tell.