The team behind Nomic, a Layer 1 blockchain providing a decentralized Bitcoin bridge, has announced the launch of a bitcoin liquid staking token (LST) called stBTC.
Nomic, which operates with its native token NOM, has partnered with the bitcoin staking protocol Babylon to introduce the LST. This collaboration aims to enhance Nomic’s security by allowing dual-staking using staked Bitcoin and staked NOM, as per a statement from Nomic developers.
Through Babylon, individuals can stake their bitcoin to Nomic, earning rewards in NOM and nBTC, which can be redeemed for bitcoin. The nBTC cryptocurrency represents a 1:1 ownership of bitcoin in a token format compatible with the Inter-Blockchain Communication Protocol (IBC). This standardized protocol enables seamless transactions between various blockchains, allowing users to utilize nBTC on decentralized platforms like Cosmos exchange Osmosis, the Cosmos Hub, and other DeFi protocols.
Nomic plans to conduct a funding round later this year. While stBTC is currently in the testing phase, it will transition to the mainnet once Babylon does the same, according to a spokesperson from Nomic. Turbofish, a blockchain technology firm, is the founder and contributor to Nomic.
Turbofish CEO Matt Bell emphasized the significance of Nomic and Babylon in providing essential primitives to Bitcoin, such as decentralized custody and staking. He stated, “By pairing the two, their impact is magnified, making a more practical solution for the average Bitcoin holder to earn yield through staking. With innovations like stBTC emerging, Bitcoin DeFi now has the potential to compete with the trading volumes and total value locked of Ethereum DeFi.”
Babylon’s progress
Babylon enables BTC holders to earn rewards by staking their assets on proof-of-stake blockchains. The platform’s developers initiated its first testnet on Feb. 28 this year.
In early December 2023, Babylon secured $18 million in a Series A funding round co-led by Polychain Capital and Hack VC, with additional backing from Framework Ventures, Polygon Ventures, Castle Island Ventures, OKX Ventures, and Symbolic Capital.