Babylon Quietly Becomes The Largest Bitcoin Staking Protocol At $5.6b TVL

@babylonlabs_io has crossed 56,853 $BTC in staked value, equivalent to roughly $5.6 billion, positioning it as the largest Bitcoin-secured protocol by total value locked (TVL). What makes the milestone notable is how it was achieved: no wrapping, no bridging, no third-party custody. Bitcoin holders lock their assets directly, retaining self-custody while earning yield from securing external proof-of-stake chains.

An Unusual Valuation Profile

The market structure around $BABY is drawing attention. The token trades at around a $60 million market cap against a TVL measured in the billions, producing an mcap-to-TVL ratio that observers have compared to early EigenLayer. The token is up roughly 30% over the past seven days and remains around 90% off its March low, suggesting the market is only beginning to price in the protocol's scale.

Institutional conviction appears to be building. Babylon Labs raised $15 million from a16z crypto to support the development of its Trustless BTCVaults infrastructure, a system designed to let native Bitcoin serve as verifiable, non-custodial collateral across on-chain financial applications. The funding came via a purchase of $BABY tokens and was accompanied by strategic input from a16z based on its experience in blockchain infrastructure.

What Comes Next: Phase-3 Multi-Staking

The next leg of Babylon's roadmap is Phase-3, which introduces multi-staking: the ability for a single BTC stake to simultaneously secure multiple proof-of-stake networks, or Bitcoin Secured Networks (BSNs). The feature was approaching its testnet phase as of mid-2025, with a mainnet launch targeted later in the year. If delivered, it would allow Bitcoin holders to earn multiple streams of staking rewards from a single, natively held asset.

The broader ambition is significant. Babylon's protocol connects Bitcoin holders with PoS chains seeking economic security, targeting what the BTCFi space has long framed as a multi-trillion dollar opportunity in dormant Bitcoin capital. With the $BTC supply largely sitting idle in wallets, protocols like Babylon are building the infrastructure to put that capital to work without requiring holders to give up custody or convert to wrapped equivalents.

The combination of a growing TVL base, credible venture backing, and an upcoming multi-staking catalyst gives Babylon an unusual position in the current crypto cycle: meaningful product traction at a valuation that has not yet caught up with the underlying activity.

Sources:
CoinDesk: Babylon Labs raises $15M from a16z crypto
DefiLlama: Babylon Protocol TVL
Babylon Labs: Official Site