RedStone Oracles Launches Staking Oracles Designed Explicitly for Bitcoin Staking

With the new implementation, users can stake their Bitcoin (BTC) in exchange for Bitcoin-based liquid-staking tokens (LSTs) like Lombard Staked BTC (LBTC) on the Ethereum blockchain.

Blockchain oracles are a crucial component in the DeFi ecosystem, enabling the integration of real-world data and events into smart contracts. They play a vital role in verifying off-chain data on the blockchain, which is essential for various DeFi applications.

One key application of oracles is in the context of crypto staking. Staking involves locking crypto assets into smart contracts to generate rewards. To calculate these rewards accurately and enable the use of staked assets in DeFi, oracles are needed.

Specifically, staking oracles collect and verify critical inputs such as staking rewards, slashing events, and other data that is necessary for the proper functioning of derivative assets such as Lido Staked Ether (stETH). These oracles ensure that the derivative assets are tracking the underlying staking rewards accurately.

Without oracles, the use cases for Bitcoin LSTs would be limited to providing liquidity on decentralized exchanges (DEXs). However, with RedStone’s Bitcoin staking oracles, users can now utilize Bitcoin LSTs, such as Lombard Staked BTC (LBTC), in a broader range of DeFi applications.

This capability allows users to employ LBTC in DeFi lending on platforms like Morpho and Compound, where they can borrow or lend assets. Additionally, the oracles and LBTC can be used on Gearbox Protocol to generate composable leverage.

Overall, the introduction of Bitcoin staking oracles is expected to drive the adoption of DeFi around Bitcoin LSTs, creating a diverse ecosystem similar to that which has emerged around Ethereum LSTs.