BitGo, a digital asset financial services platform, now supports Stacks layer, as per the latest info disclosed to Finbold on July 18.
The integration not only broadens BitGo’s ecosystem but also offers clients an opportunity to earn Bitcoin (BTC) rewards while enhancing BTC capabilities with integrated delegate and solo stacking features.
Generating BTC directly into the wallet
Through stacking, BitGo users can now generate BTC rewards directly in their wallets, without lending or additional risk.
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Additionally, BitGo now supports the Stacks token standard, further expanding its offerings.
A key component of the integration is BitGo’s role as a “signer” on the network, contributing to block production and blockchain consensus.
Upon the release of sBTC, a decentralized 1:1 Bitcoin-backed asset meant to boost Bitcoin programmability, BitGo will join the Signer network, facilitating deposits and withdrawals.
Enabling the conversion between BTC and sBTC
Signers like BitGo enable the conversion between BTC and sBTC across the Bitcoin L1 and L2 layers.
To create sBTC, users can deposit an equivalent amount of BTC into a Bitcoin blockchain script controlled by the Signer network.
The Signers then mint sBTC and transfer it to the user’s Stacks address.
Conversely, to convert sBTC back to BTC, users initiate a peg-out transaction, which signers process by sending BTC to the user’s BTC address.
The growth of the Bitcoin layer ecosystem
The Bitcoin layer ecosystem has seen unprecedented growth as the industry explores the potential of the Bitcoin economy.
Since December 2023, the total value locked (TVL) for the Bitcoin ecosystem has grown sevenfold to over $2.2 billion.
More and more developers are looking for effective ways to build on the most proven blockchain in the world.
Consequently, Bitcoin L2s and other scaling solutions offer developers the security and market potential of Bitcoin without altering Bitcoin itself.
Deeper engagement with Bitcoin
Meanwhile, investors and institutions are deepening their engagement with Bitcoin innovation.
Some investors are increasing their allocations to Bitcoin-based projects through direct investments in teams like Xverse, Hermetica, and Bitflow.
Others, such as Outlier Ventures and Bitcoin Frontier Fund, have started new accelerator programs to help Bitcoin-based teams.
On the institutional side, renewed interest in Bitcoin ETFs (exchange-traded funds) is driving fresh capital, fueling a new era of Bitcoin developers who can turn to the scalability of the Stacks layer for secure transactions and speed.
The rise of Bitcoin L2s will benefit Bitcoin holders hesitant to engage with decentralized finance (DeFi) due to perceived security risks associated with Proof-of-Stake (Pos) systems and less-proven L1s.
