Bitcoin Staking Testnet v1
The Current State of Bitcoin and PoS Systems
Bitcoin - a massive and growing market
Bitcoin is one of the most valuable cryptocurrencies nowadays, yet it faces a challenge where over 1 trillion dollars in assets often remain idle and underutilized.
However, current solutions, such as wrapping and bridging BTC or sending it to the third party, are not secure and fail to meet the needs of Bitcoin holders. This limits the potential use of these assets in decentralized finance (DeFi) applications.
99% of BTC liquidity is not earning yield. BTC would be growing much faster if it earned yield or interest rates were 0%. Since we can’t change the interest rates, we should find more ways to allow investors to earn at least enough yield to keep up with inflation (and maybe much much more).
Proof-of-Stake system security
On the other hand, a Proof-of-Stake (PoS) system requires a substantial amount of capital to be staked in the blockchain to ensure its security. PoS token holders can lock their tokens to become validators of the PoS system.
The locked tokens will be slashed, if a validator engages in malicious behavior. This deterrent mechanism means that the more tokens are staked, the greater the crypto-economic security of the PoS system. In return for their contribution to security, honest stakers receive rewards.
Unlock Bitcoin’s full potential and sharing security
Most Bitcoins are held idle and underutilized, while the security of PoS systems improves with the number of staked tokens. Can we stake Bitcoin on PoS chains? Why not harness these idle bitcoins to bolster the economic security of Proof-of-Stake (PoS) chains and decentralized apps (Dapps)?
With this idea, Scalar provides a platform to integrate Bitcoin assets into its ecosystem. By staking BTC on Scalar Bitcoin Staking testnet, these assets can be utilized within DeFi applications, increasing the Total Value Locked (TVL). This reduces fragmentation and enables stakers to earn yields and participate in various financial activities.
Scalar Bitcoin Staking Protocol
Enter Scalar Bitcoin Staking Protocol, Bitcoin holders can earn yields by staking their bitcoins on PoS chains while ensuring robust security.
The project allows BTC holders to become node operators (node validators) or delegate authority (delegate) to node validators to participate in the secure network.
PoS chains and dApps can choose to integrate bitcoin-backed security, benefiting from enhanced security, robust economic incentives, and greater adoption.
This solution ensures that Bitcoin's vast liquidity is no longer idle but actively contributes to the DeFi ecosystem, enhancing overall market efficiency and offering new opportunities for Bitcoin holders.