Crypto exchange Kraken has rolled out a new Bitcoin staking product by integrating with Babylon, a staking protocol focused on unlocking the value of idle Bitcoin. The partnership, announced on Thursday, enables Kraken users to earn rewards on their Bitcoin holdings without the need for complex processes like bridging, wrapping, or lending.
Seamless On-Exchange Staking for Users
With this integration, Kraken customers can now stake Bitcoin directly on the platform, eliminating the need for external wallets. The staked Bitcoin is securely locked in a vault on the Bitcoin blockchain and delegated to Proof-of-Stake (PoS) networks through Babylon’s protocol.
Importantly, rewards are not paid in Bitcoin but in Babylon’s native token, BABY. Following the announcement, the price of BABY rose by nearly 5%, according to CoinMarketCap.
Turning Idle Bitcoin Into Active Yield
Mark Greenberg, Kraken’s global head of consumer, emphasized the significance of this move, noting that “a substantial amount of Bitcoin currently sits idle on our exchange.” He described this as both “a significant opportunity cost for clients and a missed opportunity for the broader ecosystem.”
Greenberg added that the Babylon integration provides a way for users to earn returns while also enhancing the security of emerging PoS networks. “It enables PoS blockchains to benefit from the economic weight of Bitcoin to validate transactions and bolster the security of their networks,” he said.
A New Era for Bitcoin Utility
This development marks a notable step in expanding Bitcoin’s utility beyond passive holding. By leveraging Babylon’s staking infrastructure, Kraken is positioning itself at the forefront of efforts to bridge Bitcoin with the broader PoS ecosystem—without compromising on user simplicity or asset security.
