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Starknet has introduced a caller diagnostic that enables Bitcoin holders to stake their assets connected its Ethereum-based Layer 2 network.
Announced connected Sept. 30, the update marks what the squad calls the archetypal trustless method of staking BTC beyond its archetypal blockchain. Through the program, participants tin delegate tokenized versions of Bitcoin, gain staking rewards, and lend to Starknet’s security, each without surrendering custody of their coins.
Bitcoin itself was ne'er designed for staking. Its proof-of-work strategy keeps miners cardinal to validation, leaving small country for holders to gain output directly. Starknet circumvents this regulation by accepting wrapped representations of Bitcoin, specified arsenic WBTC, tBTC, Liquid Bitcoin, and SolvBTC.
These assets tin beryllium integrated into Starknet’s statement process and are protected by zk-STARK cryptography. Notably, the exertion is wide recognized for its velocity and post-quantum resistance.
This inaugural besides ties into Starknet’s broader ambition of becoming an execution furniture for Bitcoin. In caller tests, the squad utilized Circle STARKs to verify Bitcoin’s afloat header concatenation successful 25 milliseconds connected a Raspberry Pi, demonstrating real-world performance.
Starknet has besides launched decentralized sequencers and is collaborating with BitVM researchers to research next-generation Bitcoin scaling solutions.
Will this marque Bitcoin productive?
Starknet stated that the upgrade aims to rectify a glaring imbalance that has near astir of Bitcoin’s $2 trillion marketplace capitalization inactive connected its basal chain.
According to the firm, astir 98.5% of the supply remains unused, portion Ethereum has developed a thriving staking economy that present holds much than $38 billion, oregon approximately one-third of its circulating supply.
Bitcoin’s equivalent assemblage is comparatively small, astatine astir $2.5 billion, with lone 58,500 BTC successful circulation.
Bitcoin Staking Market (Source: Coinlaw)Starknet argued that staking Bitcoin connected its web would assistance redirect portion of this dormant worth by allowing BTC holders to summation caller output opportunities and adding a deeper information basal for the Ethereum layer-2.
Since BTC is considered comparatively lower-risk than astir integer assets, investors typically judge slimmer returns. That dynamic makes BTC an businesslike complement to STRK, Starknet’s autochthonal token, due to the fact that securing the web with Bitcoin tin beryllium little costly than relying solely connected STRK.
Developers reason that this plan could initiate a reinforcing rhythm arsenic much Bitcoin is transferred to Starknet, thereby expanding liquidity and web security.
This accrued liquidity makes Starknet’s ecosystem much appealing to builders and plus holders, which successful crook increases STRK participation. At the aforesaid time, the higher STRK engagement boosts the wide reward pool, making Bitcoin staking much charismatic and drafting adjacent much BTC into the system.
The station Will ‘Bitcoin staking’ connected Starknet truly marque BTC productive? appeared archetypal connected CryptoSlate.
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