Bitcoin News
By Sakamoto Nashi
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Bitcoin, often dubbed "digital gold," has long been seen as a store of value rather than a yield-generating asset. But that’s changing.
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As the Bitcoin market capitalization exceeds $2 trillion and more than 50 million addresses hold a balance, the demand for yield-generating strategies has intensified.
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Native Bitcoin staking is now possible thanks to Babylon, a protocol that went live on mainnet in late 2024.
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What sets Babylon apart is that it doesn’t require bridging or wrapping. The BTC remains on its native chain, minimizing exposure to third-party vulnerabilities.
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However, there's a catch. Staked BTC becomes immobile for a defined period—known as the unbonding period—during which it cannot be withdrawn.
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Despite these trade-offs, Babylon has seen impressive adoption, with over $4 billion in BTC currently staked through the platform.
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For many traders and DeFi users, lock-ups are a deal-breaker. Enter liquid staking tokens (LSTs)—a solution designed to restore liquidity while maintaining staking rewards.
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One standout example is LBTC by Lombard Finance. Here’s how it works:
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You stake BTC via Lombard’s Babylon contracts.
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You receive LBTC, a 1:1 representation of your staked BTC, issued on an EVM-compatible chain.
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LBTC can be traded, sold, or used as collateral—all while your original BTC continues earning rewards.
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When you're ready to exit, burning LBTC triggers the same seven-day unbonding period as native Babylon staking.
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On-chain volume speaks volumes—LBTC sees daily transactions of over $200 million, with liquidity sufficient to support trades up to $30 million without significant slippage.
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The real magic of LBTC lies in its capital efficiency. Unlike staked BTC, which sits idle, LBTC can be redeployed across DeFi protocols:
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Supplied to liquidity pools for additional yield.
The Currency Analytics
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