Binance Offers BTC Staking Through Babylon

The world’s largest centralized crypto exchange (CEX), Binance, introduced on-chain yields last week.

Binance’s first supported offering went live on Dec. 8, allowing users to earn yield on their BTC holdings through the Bitcoin staking protocol, Babylon.

Babylon features self-custodial capped staking pools for BTC, and boasts a total value locked (TVL) of nearly $3 billion across 40,000 unique stakers according to its dApp. Babylon’s cap-3, which opened on Dec. 10, will run for the next 1,000 blocks, likely equating to a seven-day window.

The cap-3 staking window is opened with support from Anchorage Digital, an institutional crypto platform that now allows its clients to earn yield on BTC holdings via Babylon.

Users who stake through Binance can access on-chain features and earn the native Babylon rewards directly through their Binance accounts. The goal is to simplify the on-chain staking process and mitigate potential risks associated with on-chain transactions.

Binance stakers will also earn points from the respective protocols they use. For Babylon users, Binance is offering a 12% points boost, limited up to the first 1,000 BTC staked. This function allows previously CEX-exclusive users to gain exposure to airdrop opportunities.

Despite Binance’s abstraction of the on-chain yields feature, funds are still susceptible to dApp smart contract vulnerabilities, protocol failure, and market volatility.

Attention surrounding Babylon is also picking up steam. Kaito AI, an artificial intelligence-powered data platform, shows Babylon moving up the “Pre-TGE” (token generation event) mindshare gainers over the last 30 days, flipping popular names such as OpenSea and Berachain.