Babylon Labs Is Building a trust-minimized Bitcoin bridge with the Cosmos network to enhance the world's oldest blockchain's interoperability

Babylon Labs, the company behind the largest BTC staking protocol, is teaming up with Fiamma to create a trust-minimized Bitcoin bridge with the Cosmos network. This bridge will enable BTC to be transferred to and from the Cosmos network in a secure and efficient manner.

The bridge will be powered by BitVM2, a computing paradigm that enables Ethereum-style smart contracts on Bitcoin. This will pave the way for zero-knowledge technology, which allows different parties to verify that information is accurate without actually revealing to each other what the information is.

This capability is foundational for bridging digital assets between different blockchains. Developers like Babylon Labs and Fiamma are aiming to unlock the deep wells of value stored in BTC to finance other ecosystems and allow it to be transacted on blockchains that are free of some of Bitcoin's limitations of speed and scale.

This effort is part of a broader movement to extract greater utility from Bitcoin, similar to that which is commonplace on networks like Ethereum. Babylon's Bitcoin staking protocol is one of the foremost projects in this sector.

The protocol is described as a way of using BTC to secure other protocols and decentralized applications and has a total value locked (TVL) of around $5.5 billion.

Developers have been exploring various methods to expand Bitcoin's capabilities and introduce new use cases. One significant development in this domain is the introduction of BitVM2 by Robin Linus in October 2023.

This advance in Bitcoin's computing capabilities is designed to pave the way for a rollup that can handle faster and cheaper transactions without compromising on security.

This capability could then enable bridges to securely transfer BTC to the rollup and later bring the BTC back so that deposits can be withdrawn.

BitVM's introduction sparked enthusiasm among developers building projects on Bitcoin, including some focused on bridging to other networks.

For instance, zero-knowledge rollup Citrea, which is backed by Galaxy Digital, deployed a BitVM-based bridge to the Bitcoin testnet in September 2024.

This bridge is designed to be compatible with the Ethereum Virtual Machine (EVM), the software that executes smart contracts and powers the Ethereum protocol.