Kraken Launches Bitcoin Staking Service With Babylon Integration

Kraken, a leading cryptocurrency exchange, has introduced a Bitcoin staking service through its integration with Babylon, a Bitcoin-native staking protocol. This new offering allows Kraken clients to earn passive rewards on their Bitcoin holdings without the need to move their assets off the Bitcoin blockchain. The integration enables users to lock their Bitcoin in a custodial vault on the native chain, providing a secure and straightforward way to participate in staking.

The announcement, made in a June 19 blog post, positions Kraken alongside a growing number of institutions leveraging Babylon’s staking infrastructure. Kraken customers can now use Babylon’s protocol to assign their Bitcoin to proof-of-stake blockchains while retaining complete ownership of their assets. This approach avoids the trade-offs associated with traditional staking solutions, which often require wrapping or bridging Bitcoin to other networks. The underlying Bitcoin remains on the Bitcoin blockchain and is never lent out or rehypothecated.

Through Babylon’s smart contract-based delegation mechanism, staked assets help to secure PoS networks. In return, users receive rewards in BABY, Babylon’s native token. The service features a seven-day unbonding period, transparent reward tracking, and cryptographic penalties for bad actors. Kraken’s global head of consumer, Mark Greenberg, described the launch as an opportunity to put idle BTC to productive use. “A substantial amount of Bitcoin currently sits idle on our exchange,” he said. “Clients can now earn a return while strengthening the infrastructure of emerging PoS blockchains.”

Kraken joins other platforms that have embraced Babylon’s infrastructure to offer native Bitcoin yield opportunities. Over 57,000 BTC, worth over $5.6 billion, have already been staked on Babylon’s Genesis mainnet since it launched in April 2025, demonstrating growing institutional interest in Bitcoin-native decentralized finance protocols. Until now, less than 1% of Bitcoin’s total supply is involved in DeFi, primarily due to the technical complexity and security risks of bridging BTC to other chains. By enabling trustless delegation from Bitcoin to PoS networks, Babylon’s approach reduces those frictions while extending BTC’s utility in the broader crypto ecosystem.

Kraken’s new staking service is now live across all interfaces, including Kraken Pro. Staking yields up to 1% APR, with weekly BABY rewards, though rates may vary. The company noted that staking involves risk and is subject to regional restrictions. The launch of this service marks a significant development for Kraken, as it introduces secure Bitcoin staking that supports Proof-of-Stake networks. This is a first for Kraken clients, who can now earn BABY tokens as rewards for staking their Bitcoin. The integration simplifies the process of generating yield from Bitcoin, enhancing the platform's capabilities and exploring staking features across various cryptocurrencies.

By integrating Babylon, Kraken ensures that users maintain full control over their Bitcoin while participating in the staking process. This feature not only provides a new opportunity for clients to earn passive income but also demonstrates Kraken's commitment to innovation and expanding its service offerings. The launch of this service is expected to attract more users to the platform, as it offers a unique and secure way to stake Bitcoin natively.