As stated by pSTAKE in its blog post, “The innovation will help illuminate the emerging BTCfi industry, which currently utilizes less than 1% of the trillion-dollar market cap possessed by Bitcoin. pSTAKE intends to be a catalyst to spur BTCfi growth by providing a direct route to earning a yield for BTC deposits with Babylon.”
pSTAKE Finance, a platform backed by the venture capital arm Binance Labs, has introduced a liquid staking solution for Bitcoin.
Typically, Proof-of-Work tokens like Bitcoin (BTC) use crypto mining instead of staking to verify transactions on the blockchain. However, Babylon’s staking protocol circumvents this notion by allowing Proof-of-Stake networks to receive staking assets from PoW chains.
As such, pSTAKE Finance has collaborated with Babylon to improve Bitcoin’s yield-generating capabilities. Designed atop Babylon's Bitcoin staking protocol, pSTAKE Finance's solution aims to streamline the staking process for the most popular crypto token.
pSTAKE’s latest yield generating product also marks the company’s first venture into the Bitcoin ecosystem following three years of developing its liquid staking protocol on Cosmos. Meanwhile, DeFi innovations centered around Bitcoin have seen an uptrend in popularity since its fourth halving event, which also coincided with the launch of Bitcoin Runes. In fact, Binance Labs has also revealed its plans to invest into BounceBit, a restaking protocol for Bitcoin.