Welcome to the 7th edition of our exciting new series, dubbed the ‘X Talks Bitcoin’ series. This is not just another industry discussion. It’s a unique opportunity for the pSTAKE community and Bitcoin enthusiasts to gain exclusive insights into Bitcoin, the emerging BTCfi industry, and potential yield-generating strategies.
Our series will feature expert opinions, providing invaluable insights into the future of Bitcoin and how we can all best position ourselves. These discussions are not just relevant but crucial to all our readers, offering a “not-to-be-missed” and “thought-provoking” perspective on what’s coming next for Bitcoin.
We spoke to Arcanum Capital in the previous edition about Bitcoin Ecosystem from an Investor’s eye Today Luke from SatLayer shares candid thoughts on BTC yields with Bitcoin restaking.
1) Shared Security is one of the leading categories today. Where does Bitcoin Restaking fit into this landscape from the perspective of security consumers (BVS)?
As a security consumer and Bitcoin Validated Service (BVS) builder, having their decentralized application (dApp) or protocol secured by restaked Bitcoin is quite interesting, since Bitcoin is the most secure, resilient, and largest asset in all of crypto. As such, there’s actually no better collateral for shared security, especially as Bitcoin is secured by Proof-of-Work.
This is the core mission of SatLayer: enabling Bitcoin restaking with fully programmable slashing, building on Babylon’s capabilities. Bitcoin staked in Babylon can be restaked through SatLayer, allowing BVSes to easily access Bitcoin-backed crypto-economic security guarantees. This approach also addresses the cold start problem, reducing reliance on a protocol’s native utility token for foundational security.
2) Bitcoin has historically been viewed as a non-yield-bearing asset. How does Restaking create new avenues for yield generation for BTC?
Bitcoin has historically been a bit of an idle asset from a yield perspective. This has completely changed recently, with the launch of Bitcoin LSTs such as pStake, and Babylon’s staking mainnet.
This enables Bitcoin stakers to earn rewards from not just pStake, but also Babylon. Users can then restake their Bitcoin LST (such as pStake’s yBTC soon) or wrapped BTC (WBTC, FBTC, etc.) on SatLayer to earn additional rewards. This means that for a single Bitcoin stake, users can earn rewards from 3 different protocols (pStake, Babylon, SatLayer)!
For context, Babylon allows Bitcoin holders to deposit their BTC as collateral, extending Bitcoin’s crypto-economic security to other proof-of-stake (PoS) blockchains and earning yield in return. Babylon secures other PoS chains against equivocation (e.g. validator double signing), however, it’s slashing capabilities do not address other forms of misbehavior.
DApps and protocols seeking to safeguard against issues such as compromised liveness, fairness, correctness, or solvency in more general ways have no means to leverage Bitcoin’s security for these broader challenges. This is where SatLayer comes in: building on Babylon’s foundation to leverages restaked Bitcoin as programmably slashable collateral for security and capital efficiency. By doing so, SatLayer significantly broadens the scope of security Bitcoin can offer and unlocks its full potential as a reward-generating asset.
3) Between BTC and ETH, what do you consider superior for Restaking security consumption, and why?
ETH certainly has the more mature ecosystem in terms of infrastructure (EigenLayer, LRTs, etc.) and developers. However, from a restaking collateral perspective, there is no asset better than BTC. Objectively speaking, Bitcoin is the most secure, resilient, and largest crypto asset. It’s also secured by Proof-of-Work, which means that an attacker needs to control 51% of the mining hashrate in order to compromise Bitcoin, whereas for Ethereum, an attacker only needs to control 33% of the stake.
Recent innovations from pStake, Babylon and SatLayer (detailed above) enable Bitcoin to be used natively for restaking and are quickly building out the BTC-native ecosystem. By integrating SatLayer’s innovations with Babylon’s foundation and pStake’s LST, Bitcoin restaking becomes more flexible, efficient, and rewarding. This cements Bitcoin’s role in securing a variety of dApps, infrastructure, and protocols as BVSes – offering greater resilience against attacks. This makes Bitcoin a compelling alternative to Ethereum for restaking, bringing BTC’s unparalleled security to a wider range of networks and use cases while ensuring greater resilience, capital efficiency, and lower costs in securing new decentralized systems.
4) How can SatLayer be compared to the broader Restaking platforms today like EigenLayer, Symbiotic, or Pell Network?
SatLayer’s primary focus is to extend Bitcoin’s unparalleled cryptoe-conomic security to other networks while preserving Bitcoin’s core integrity. This sets it apart from the likes of EigenLayer, Symbiotic, and Pell Network, which are Ethereum-centric or pursuing overly cross-chain solutions for restaking.
SatLayer taps into Bitcoin’s $1T+ market cap and its unmatched decentralization and censorship-resistant PoW consensus, offering a unique and powerful crypto-economic security layer for dApps, infrastructure, and protocols. This makes SatLayer particularly compelling for projects that prioritize the resilience and security that only Bitcoin can offer.
About pSTAKE Finance
pSTAKE Finance is a Bitcoin Yield and Liquid Staking protocol, backed by Binance Labs.
With pSTAKE Finance, users can liquid stake BTC to get rewards from Babylon’s Trustless BTC staking for securing other app chains while maintaining their liquidity.
Accessing Bitcoin yields should not be complex, risky, or unsafe. With four years of liquid staking expertise and expert-curated yield strategies, pSTAKE Finance helps individuals and institutions put their BTC to work in BTCfi.
pSTAKE Finance has partnered with leading blockchain security firms, such as Halborn, Hexens, Oak Security, Immunefi, Forta, and more, to offer a secure liquid staking product suite.
PSTAKE is the governance and incentivization token of the pSTAKE Finance protocol. It has some of the most prominent investors, including Binance Labs, DeFiance Capital, Spartan Group, Coinbase Ventures, and Kraken Ventures.
