Babylon Raises $18 Million Funding to Advance Bitcoin Staking Protocol
Babylon raised $18 million in financing for its Bitcoin staking protocol to expand the existing team and foster growth of the Web3 ecosystem.
Babylon Bitcoin staking protocol currently in development, raised $18 million in financing, led by Polychain Capital and Hack VC, with contributions from Framework Ventures, Polygon Ventures and OKX Ventures. The allocated funds will be utilized to expand the existing team and foster the growth of the ecosystem.
The Babylon protocol is designed to enable Bitcoin holders to stake their coins on proof-of-stake blockchains, earning yield in the process. Essentially, it allows proof-of-stake chains to introduce Bitcoin as a staking asset on their networks.
Babylon aims to leverage Bitcoin’s security to enhance the security of proof-of-stake chains. Unlike existing proof-of-stake chains that rely on capital from their native tokens for security, Babylon aims to provide a more cost-effective solution, particularly for emerging chains facing challenges associated with high inflation rates needed to attract substantial staking capital.
Babylon’s staking service integrates Bitcoin Ordinals technology, with the goal of expanding the utility of Bitcoin beyond its role as a store of value. Babylon founder David Tse sees potential demand for his product among Bitcoin holders, despite some opposition within the Bitcoin community towards new use cases for the asset.
The anticipated launch date for the staking service is April 2024, preceded by the test network in January 2024. The deployment of the main network depends on the security audit results of the Babylon test network.
Once launched, the Babylon chain protocol will serve as the control plane between Bitcoin and proof-of-stake chains.
Fostering the Future of Decentralized Security
The Babylon funding for the round initiated in late July, has concluded now. It followed an equity plus token warrant structure, mirroring the $8 million seed funding round for Babylon led by IDG and Breyer Capital earlier this year.
According to the project litepaper, Babylon’s objective is to create a “Bitcoin-secured decentralized world” by transforming all 21 million Bitcoin, the total supply, into a decentralized staking asset. Currently, nearly 19.6 million Bitcoins are in circulation.
By raising $18 million in financing Babylon protocol edges closer to enabling Bitcoin holders to stake coins on proof-of-stake blockchains, enhancing security without the cost constraints faced by traditional proof-of-stake chains. With an anticipated launch in April 2024, the protocol marks a significant step toward a decentralized world secured by Bitcoin.
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