staking, liquid staking tokens and vaulted strategies
The post staking, liquid staking tokens and vaulted strategies appeared on BitcoinEthereumNews.com. The following is a guest post and analysis from Vincent Maliepaard, Marketing Director at Sentora. The Bitcoin market cap recently surpassed $2 trillion, and with over 50 million bitcoin addresses with a balance, the value of the asset is becoming undeniable. However, where traditional currencies like dollars or euros typically pay interest on holdings, Bitcoin provides no such rewards for simply holding the asset. More recently though, two distinct pathways have emerged to change that picture: Native Bitcoin “staking” – lock BTC in the Babylon protocol and earn fees. Liquid‑staking tokens (LSTs) – mint a tradable receipt such as LBTC that keeps the staking rewards flowing while restoring liquidity. These two solutions provide a viable route to earning stable yield on your Bitcoin. Let’s dive into what this entails and how it works. From Proof‑of‑Stake to Proof‑of‑Bitcoin Babylon went live on mainnet in late‑2024, letting BTC holders time‑lock coins on the Bitcoin chain and delegate them to so‑called Bitcoin‑Secured Networks. The networks pay out fees in BTC, producing a yield of roughly 1 – 2 % currently. Babylon Staking Statistics The idea has caught on quickly: Babylon reports more than $4 billion in BTC staked on the protocol since last year. Key features No wrapping or bridges: BTC never leaves its native chain. Main risks: a protocol bug or “slashing” if a delegated validator misbehaves. Drawback: staked coins stay immobile until an unbonding timer expires. Liquid staking: LBTC puts mobility back on the menu Lock‑ups are a deal‑breaker for many traders. Liquid‑staking tokens fix that by issuing a transferable asset that represents the underlying stake plus its future rewards. An example of such a liquid staking token for Bitcoin is LBTC from Lombard Finance 1:1 minting: stake BTC through Lombard’s Babylon contracts and receive LBTC on an EVM chain. (Lombard) Seven‑day exit: burn LBTC…
The post staking, liquid staking tokens and vaulted strategies appeared on BitcoinEthereumNews.com.
The following is a guest post and analysis from Vincent Maliepaard, Marketing Director at Sentora. The Bitcoin market cap recently surpassed $2 trillion, and with over 50 million bitcoin addresses with a balance, the value of the asset is becoming undeniable. However, where traditional currencies like dollars or euros typically pay interest on holdings, Bitcoin provides no such rewards for simply holding the asset. More recently though, two distinct pathways have emerged to change that picture: Native Bitcoin “staking” – lock BTC in the Babylon protocol and earn fees. Liquid‑staking tokens (LSTs) – mint a tradable receipt such as LBTC that keeps the staking rewards flowing while restoring liquidity. These two solutions provide a viable route to earning stable yield on your Bitcoin. Let’s dive into what this entails and how it works. From Proof‑of‑Stake to Proof‑of‑Bitcoin Babylon went live on mainnet in late‑2024, letting BTC holders time‑lock coins on the Bitcoin chain and delegate them to so‑called Bitcoin‑Secured Networks. The networks pay out fees in BTC, producing a yield of roughly 1 – 2 % currently. Babylon Staking Statistics The idea has caught on quickly: Babylon reports more than $4 billion in BTC staked on the protocol since last year. Key features No wrapping or bridges: BTC never leaves its native chain. Main risks: a protocol bug or “slashing” if a delegated validator misbehaves. Drawback: staked coins stay immobile until an unbonding timer expires. Liquid staking: LBTC puts mobility back on the menu Lock‑ups are a deal‑breaker for many traders. Liquid‑staking tokens fix that by issuing a transferable asset that represents the underlying stake plus its future rewards. An example of such a liquid staking token for Bitcoin is LBTC from Lombard Finance 1:1 minting: stake BTC through Lombard’s Babylon contracts and receive LBTC on an EVM chain. (Lombard) Seven‑day exit: burn LBTC…
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