Kraken Launches Bitcoin Staking via Babylon Protocol Partnership

Crypto exchange Kraken has announced a strategic partnership with Babylon Labs to launch a Bitcoin staking product, enabling users to earn yields directly on their Bitcoin holdings without traditional bridging or wrapping.

CoinMarketCap BABY Price Chart (Post-Announcement) — *24-hour BABY token price chart following announcement. Source: CoinMarketCap.*

Announced on Thursday, the integration connects Kraken users to the Babylon protocol, a Bitcoin staking mechanism. The offering allows users to stake their BTC, which is locked in a vault on the Bitcoin blockchain and delegated to secure Proof-of-Stake (PoS) networks via Babylon.

Users participating in the Kraken-Babylon program earn rewards in the Babylon native token, BABY, rather than Bitcoin. Following the launch announcement, the price of BABY saw a nearly 5% increase according to CoinMarketCap data.

Enabling Utility and Yield on Idle Bitcoin

Speaking to the initiative, Kraken Global Head of Consumer, Mark Greenberg, stated that a “substantial amount of Bitcoin currently sits idle on [their] exchange.” He described this idle asset as representing a “significant opportunity cost for clients and a missed opportunity for the broader ecosystem.” The new product, Greenberg emphasized, allows clients to “earn a return on their Bitcoin.”

Furthermore, Greenberg highlighted the network-level benefits, noting that the integration “enables emerging Proof-of-Stake blockchains to benefit from the economic weight of Bitcoin to validate transactions and bolster the security of their networks.”

Notably, Kraken users can access the staking service immediately without interacting with off-exchange wallets, streamlining the process.