**Babylon’s Bitcoin Staking Protocol Proposes Inflation Cut and Introduces BTC-BABY Joint Staking**
On September 29, the Babylon Bitcoin staking protocol community announced a new proposal aimed at adjusting the BABY token economics. The key goals of this proposal are to cut inflation and introduce BTC-BABY joint staking, which together seek to enhance rewards for stakers and improve Bitcoin’s role in decentralized finance (DeFi).
### Babylon Plans to Reduce Inflation from 8% to 5.5%
The latest proposal, crafted by the Babylon community, intends to significantly realign the BABY token’s economic model. One of the most notable changes is reducing inflation from 8% to 5.5%. This adjustment redefines the token distribution framework, aiming to incentivize deeper participation within the network.
David Tse, Babylon’s founder, emphasized the significance of these changes, noting that the proposal focuses on making Bitcoin more productive and efficient:
> “Babylon is about building native use cases for Bitcoin. It makes Bitcoin productive, trustlessly.”
### New Inflation Allocation and Joint Staking Incentives
Under the new model, inflation will be allocated across various staking categories as follows:
– **1% inflation** allocated to BTC stakers
– **2% inflation** allocated to BABY stakers
– **2.35% inflation** allocated to co-stakers who jointly stake BTC and BABY tokens
This new distribution approach is designed to encourage BTC and BABY holders to participate more actively by staking together, thereby fostering stronger network engagement and reinforcing the protocol’s security.
### Babylon Enhances Bitcoin’s DeFi Utility
Babylon stands out as the first protocol to leverage Bitcoin’s native script and vaults to implement cryptographic slashing and reward mechanisms — all without relying on bridges. This unique design underscores Babylon’s commitment to building secure, trustless, and native Bitcoin use cases.
### Bitcoin Market Overview
Bitcoin (BTC) currently holds a commanding presence in the cryptocurrency market:
– **Price:** $112,190.55 (as reported by CoinMarketCap)
– **Market Capitalization:** $2.24 trillion
– **Market Dominance:** 57.78%
– **24-hour Trading Volume:** $33.30 billion (a 32.02% change)
– **Circulating Supply:** 19.93 million BTC
Recent months have shown varied performance trends for BTC, highlighting the dynamic nature of the market.
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This proposal awaits the Babylon community’s review and support as it aims to reshape the future of the BABY token and maximize Bitcoin’s productivity through innovative staking mechanisms.
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