Starknet launches Bitcoin staking and yield products in BTCFi expansion

ChainCatcher news, according to The Block, Bitcoin staking has launched on Starknet, marking the first implementation of trustless Bitcoin staking on a Layer 2 network.

Holders retain custody of their assets while earning rewards, contributing to network consensus, which Starknet refers to as "the Bitcoin strategy for seasoned Bitcoin holders." This move does not alter the Bitcoin base layer but relies on wrapped versions of BTC, such as WBTC, tBTC, Liquid Bitcoin, and SolvBTC, which can be staked on Starknet.

At the same time, the Starknet Foundation will allocate 100 million STRK (12 million USD) to promote the development of the BTCFi ecosystem, including incentivizing Bitcoin collateralized lending, making Starknet the most cost-effective place to stake Bitcoin and implement yield strategies.

Additionally, Re7 Capital announced on Tuesday plans to launch a new Bitcoin-denominated yield product on Starknet in October, which will generate returns directly in Bitcoin by combining off-chain derivatives, DeFi strategies, and Bitcoin staking. The fund will be tokenized to facilitate participation from more investors.