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Binance Labs backs Babylon, a protocol that enables Bitcoin staking for PoS chains

Binance Labs, the venture capital and incubation arm of Binance, has announced its investment in Babylon, a Bitcoin staking protocol that allows users to stake bitcoins for Proof-of-Stake (PoS) blockchains and earn yields without relying on any third-party custody, bridge solutions or wrapping services.

Babylon is a blockchain project that designs security sharing protocols for the decentralized economy, founded in 2022 by Stanford Professor David Tse and Dr. Fisher Yu. The project aims to scale Bitcoin to secure the PoS economy by leveraging the three primary facets of Bitcoin: its asset, its reliable timestamping service, and its most censorship-resistant blockspace in the world.

Babylon’s flagship product is the Bitcoin Staking Protocol, which pioneers the concept of native Bitcoin staking. It provides slashable economic security guarantees to the PoS chains while ensuring efficient stake unbonding to enhance liquidity for Bitcoin holders. It also reduces the inflationary pressure and unlocks new utility for the native tokens of the PoS chains by allowing them to acquire staking capital from the largest crypto asset in the world instead of their own token.

“Bitcoin staking introduces a crucial new use case for the industry, marking a significant stride in the integration of Bitcoin with the Proof-of-Stake economy. Binance Labs’ investment in Babylon represents our commitment to supporting innovative projects leading the Bitcoin narrative and advancing its use cases,” said Yi He, Co-Founder of Binance and Head of Binance Labs.

Babylon is built using the Cosmos SDK, a framework for building interoperable blockchains. Babylon chain provides Bitcoin timestamping services to PoS chains and acts as a control plane to synchronize between the Bitcoin network and the PoS chains. It is responsible for the facilitation of BTC staking, finality round participation, and tracking of validator staking information, ultimately acting as a channel between Bitcoin’s Proof-of-Work (PoW) world and PoS chains.

The protocol is led by a team of consensus protocol researchers from Stanford and experienced Layer-1 engineers. The foundation of Babylon is based on the accumulated research and synthesis of ideas around PoW and PoS consensus at Stanford research labs.

“The Bitcoin staking protocol unifies the entire blockchain industry, from Bitcoin to the PoS world. We are thrilled to have the support of Binance Labs in building such a broad-based Babylon ecosystem,” commented David Tse, Co-Founder of Babylon.

Babylon is currently in the testnet phase and plans to launch its mainnet in the second quarter of 2024. The project also plans to launch the Bitcoin Timestamping Protocol and the Bitcoin Data Availability Protocol in the future, which will enable PoS chains to leverage Bitcoin’s reliable timestamping service and censorship-resistant blockspace, respectively.

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