On August 22, Babylon, a Bitcoin staking platform, announced the launch of its mainnet, leading to a significant spike in Bitcoin transaction fees as users rushed to stake their BTC.
In just a few hours after the launch, Babylon attracted over 12,700 investors who participated in staking, reaching its initial limit of 1,000 BTC, equivalent to more than $60 million. The sudden surge in staking activity on Babylon caused Bitcoin transaction fees to skyrocket from a few cents per transaction to as high as $137. Most transactions during this period involved 0.03 BTC, the maximum amount Babylon allows per address.
The fee paid to Bitcoin miners per block rose dramatically from the usual $18,000 to $905,000, with the total fees during this period amounting to nearly 70 BTC (over $4 million), according to data from CryptoQuant.
Babylon claims that its staking solution allows investors to deposit Bitcoin into any Proof-of-Stake (PoS) system without using third-party addresses, bridges, or oracles, ensuring that users’ funds are kept completely secure.
However, at present, the staking functionality is limited to “locking” assets and does not yet offer rewards until Babylon launches its own PoS blockchain and supports other PoS chains.
To date, Babylon has raised $96 million and is backed by prominent investment funds such as Paradigm, Binance Labs, and Polychain Capital.
This development is a notable advancement for the Bitcoin ecosystem, following a long period of relative inactivity since the decline of the Ordinals and Runes Protocol hype in May.
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