Kraken, one of the world’s leading crypto exchanges, has launched a new feature allowing users to earn rewards on their Bitcoin (BTC) holdings. This was made possible through a partnership with Babylon, a new type of staking protocol. For the first time, Kraken users can stake their Bitcoin without wrapping or lending it, helping secure Proof-of-Stake (PoS) networks while fully owning their BTC. Kraken Launches Bitcoin Staking with Babylon This new feature allows Kraken users to delegate their BTC to Babylon, which uses a special time-lock method to help secure PoS blockchains. Users receive weekly rewards paid in Babylon’s token, BABY. Importantly, users’ Bitcoin stays on the network and is never moved or lent out. Users can start staking instantly, but if they choose to unstake, there is a seven-day waiting period before the BTC becomes fully available. During this period, no rewards will be earned. The staking feature is currently available to users in the U.S. but not in California, Maine, Maryland, New Jersey, New York, Washington, and Wisconsin. It is also unavailable in the U.K., Australia, and the United Arab Emirates. Kraken Unlocks Bitcoin Rewards Without Lending or Wrapping Unlike other platforms that offer Bitcoin interest through lending programs, Kraken’s method uses Babylon’s unique time-lock system. Bitcoin holders do not need to trust third parties with their coins or use wrapped tokens. Instead, users lock their Bitcoin using Bitcoin’s native Taproot scripts. Babylon then uses this locked coin as a security layer to help protect PoS chains such as Ethereum (ETH), Solana, Avalanche, and Sui. Kraken’s leadership believes this is a major step forward. Kraken co-CEO Arjun Sethi added that Bitcoin staking has long been seen as impossible because the Bitcoin network does not support smart contracts or native staking features. However, with Babylon’s approach, that gap is now being bridged. Even though the staking process does not involve wrapping or lending, it is not entirely risk-free. Users may still encounter risks such as fluctuating reward token values, unstaking delays, and reliance on centralized platforms like Kraken. Also, the rewards are not paid in Bitcoin but in external tokens like BABY. Still, this approach avoids many problems in traditional earn programs, which often rely on lending and carry more counterparty risk. Kraken’s Expanding Roadmap Kraken has been busy in 2025. It recently launched its own Ethereum Layer 2 network called Ink. The company recently rolled out a prime brokerage for institutional investors and shared plans to start tokenized stock trading soon. In March, the exchange acquired trading platform NinjaTrader for $1.5 billion . This move marked the largest merger between traditional and crypto finance. The post Kraken Unlocks Bitcoin Rewards Through Babylon Integration appeared first on TheCoinrise.com .
