Babylon Protocol Receives Funding from Binance Labs

Check the Crypto Market Today:

Bittime - Babylon Protocol is a project that develops the Bitcoin staking protocol, which allows Bitcoin holders to stake their assets on a proof-of-stake (PoS) network without the need to exchange or wrap their Bitcoins. Thus, the Babylon Protocol opens up new opportunities for Bitcoin, which currently serves only as a store of value asset, to participate in the ever-expanding PoS economy.

Recently, on February 27, Babylon Protocol announced that it has secured an investment from Binance Labs, a venture capital firm from the world's largest crypto exchange, Binance. The amount of investment was not disclosed, but it is estimated to be in the millions of US dollars. This investment demonstrates Binance Labs' support of Babylon Protocol's vision to integrate Bitcoin with the PoS network, which is considered the future of the blockchain industry.

What is Babylon Protocol?

Babylon Protocol is a platform that allows Bitcoin holders to stake their Bitcoins on PoS networks, such as Ethereum, Cardano, Polkadot, and others. A PoS network is a network that uses a ownership-based consensus mechanism, where validators who ensure the security and validity of transactions are selected based on the number of tokens they stake. PoS networks are considered more efficient, energy-efficient, and environmentally friendly than proof-of-work (PoW) networks, such as Bitcoin, which use computing power to solve mathematical puzzles.

One of the challenges faced by PoS networks is how to attract enough staking capital to maintain network security. PoS networks typically rely on their native tokens for this purpose, but this can pose an inflation problem, as networks have to create more tokens to provide attractive staking returns. In addition, the native token of the PoS network may not have high liquidity and demand in the market, thus increasing the risk of volatility and price drops.

Babylon Protocol offers an alternative solution to PoS networks, namely by utilizing Bitcoin, the largest and most liquid crypto asset in the world, as a source of staking capital. Using the Babylon Protocol, Bitcoin holders can stake their Bitcoins on the PoS network of their choice, and earn returns in the form of the network's native token. Thus, the Babylon Protocol provides new utility to Bitcoin, which has only served as a store of value asset, and provides advantages for PoS networks, which can increase security and reduce their inflationary pressures.

How Does the Babylon Protocol Work?

The Babylon Protocol is built on the Cosmos SDK, an open source framework that allows developers to create custom blockchains for various applications. The Babylon Protocol serves as a bridge between the Bitcoin network and the PoS network, facilitating the transfer and staking of Bitcoin on the PoS network.

To use the Babylon Protocol, Bitcoin holders must send their Bitcoins to an address specified by the protocol, which serves as a staking wallet. Then, they can choose the PoS network they want to stake on, and the amount of Bitcoin they want to stake. After that, they will receive a token representing their Bitcoin on the PoS network, called bBTC. These bBTC tokens can be used to interact with PoS networks, such as selecting validators, sending and receiving transactions, and accessing decentralized (DeFi) services.

Bitcoin holders who use the Babylon Protocol will earn staking returns in the form of the native tokens of the PoS network they stake, such as ETH, ADA, DOT, and others. These staking returns will be transferred to their staking wallet periodically, and can be withdrawn at any time. If Bitcoin holders wish to end their staking, they can return their bBTC tokens to the protocol, and receive back their Bitcoins, minus network fees.

The Babylon Protocol guarantees the security and integrity of Bitcoin staking by using Bitcoin's timestamp mechanism, which allows the protocol to verify Bitcoin transactions that occur on the PoS network. In addition, the Babylon Protocol also uses a control mechanism, which ensures that the Bitcoin network and the PoS network remain in sync, and no fraud or manipulation occurs.

Also Read How to Buy Crypto:

Why Binance Labs Invested in Babylon Protocol?

Binance Labs is the venture capital and incubation arm of Binance, which aims to support innovative and impactful projects in the blockchain industry. Binance Labs has invested in various projects, from infrastructure, DeFi, NFTs, to Web3.

Binance Labs announced its investment in the Babylon Protocol on February 27, 2024, as part of their commitment to support projects that advance the use case of Bitcoin and the PoS economy. Yi He, Co-Founder of Binance and Head of Binance Labs, said:

“Staking Bitcoin memperkenalkan kasus penggunaan baru yang penting untuk industri ini, menandai langkah besar dalam integrasi Bitcoin dengan ekonomi Proof-of-Stake. Investasi Binance Labs dalam Babylon mencerminkan komitmen kami untuk mendukung proyek-proyek inovatif yang memimpin narasi Bitcoin dan memajukan kasus penggunaannya.”

Investasi Binance Labs di Babylon Protocol juga sejalan dengan fokus mereka pada sektor staking dan restaking, yang merupakan salah satu tren terbesar di industri blockchain saat ini. Staking dan restaking adalah proses di mana pemegang token dapat mempertaruhkan token mereka di jaringan PoS, dan mendapatkan imbal hasil dalam bentuk token lain, baik yang berasal dari jaringan yang sama atau berbeda. Hal ini memungkinkan pemegang token untuk meningkatkan profitabilitas dan diversifikasi portofolio mereka.

Dalam beberapa minggu terakhir, Binance Labs juga telah berinvestasi di Renzo dan Puffer Finance, dua protokol restaking likuid Ethereum terkemuka, yang memungkinkan pemegang ETH untuk mempertaruhkan ETH mereka di jaringan PoS lain, seperti Polygon, Solana, dan Avalanche, dan mendapatkan imbal hasil dalam bentuk token jaringan tersebut.

Apa Masa Depan Babylon Protocol?

Babylon Protocol saat ini masih dalam tahap pengembangan, dan belum meluncurkan layanan staking Bitcoin-nya secara publik. Namun, proyek ini telah menarik perhatian dan dukungan dari berbagai pihak, termasuk Binance Labs, IDG Capital, Breyer Capital, dan lainnya.

Babylon Protocol berencana untuk meluncurkan jaringan uji coba pada Januari 2024, dan jaringan utama pada April 2024, tergantung pada hasil audit keamanan. Setelah diluncurkan, Babylon Protocol akan membuka peluang bagi pemegang Bitcoin untuk mempertaruhkan Bitcoin mereka di berbagai jaringan PoS, dan mendapatkan imbal hasil yang kompetitif.

Babylon Protocol juga berharap untuk menjadi platform yang inklusif dan terdesentralisasi, yang didukung oleh komunitas yang kuat dan beragam. Untuk itu, proyek ini akan meluncurkan token asli mereka, yang akan digunakan untuk tata kelola, insentif, dan partisipasi dalam ekosistem Babylon. Token ini akan didistribusikan secara adil dan transparan kepada pemangku kepentingan, termasuk pemegang Bitcoin, validator, pengembang, dan mitra.

Cek Harga Crypto Hari Ini:

Cara Beli Crypto di Bittime

Kamu bisa beli dan jual aset crypto dengan cara yang mudah dan aman melalui Bittime. Bittime adalah satu aplikasi kripto terbaik di Indonesia yang sudah resmi terdaftar Bappebti. 

To be able to buy crypto assets on Bittime, make sure you have registered and completed identity verification. In addition, also make sure that you have enough balance by depositing some funds into the wallet. For your information, the minimum asset purchase at Bittime is Rp10,000. After that, then you can make a crypto asset purchase in the application. Learn the Complete Guide on How to Buy Crypto on Bittime.

Monitor the price chart movements of Bitcoin (BTC), Ethereum (ETH), Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.

Also Read:

Babylon's Bitcoin Staking Protocol Enters Testnet Stage

Babylon Launches Testnet for Trustless Bitcoin Staking

What is Wrapped Bitcoin (WBTC)? Bridging Bitcoin to the DeFi World

DISCLAIMER: This article is informational in nature and does not constitute an offer or solicitation to sell and buy any crypto asset. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices may change significantly from time to time and Bittime is not responsible for fluctuations in crypto asset exchange rates.