Bitcoin security for proof of stake? Why not, says Babylon

Babylon, a crypto security blockchain that uses Bitcoin’s proof-of-work security to integrate with proof-of-stake chains, plans to go beyond the cosmos.

Babylon was designed by David Tse and his team at Stanford’s Blockchain Consensus Protocol Lab and was created using the Cosmos Software Development Kit (SDK). It communicates with Bitcoin through a Bitcoin timestamp protocol.

This means it interacts with the Bitcoin chain by sending events on Babylon to the Bitcoin chain, Tse told Blockworks in an interview.

In Satoshi Nakamoto’s original Bitcoin white paper, the author noted how they wanted to build Bitcoin to become a timestamp server, Tse said.

“In his case, he was interested in timestamping Bitcoin transactions,” Tse said. “It turns out that you can also put arbitrary data into the Bitcoin chain, so you can timestamp not only Bitcoin transactions, but also events that happen outside of the Bitcoin chain.”

Using this knowledge, Babylon is able to time-stamp events that occur on different proof-of-stake chains.

Read more: The Beginner’s Guide to Consensus Mechanisms

Wait, so how does it make the blockchain more secure?

Existing proof-of-stake chains like Osmosis already have a handful of validators signing transactions.

What Babylon does through Bitcoin Timestamps is bring in a second level commission to certify the transaction.

“For smaller transactions of $1,000 or a few hundred, the proof-of-stake commission is sufficient – ​​they are quick to validate and approve transactions, but if you have a very high value transaction or transactions that actually security of the proof-of-stake chain, which deserves an extra level of protection against Bitcoin,” Tse said.

An example of Tse notes are non-binding transactions, where the transaction itself affects the security of the validators. “Bitcoin is slower, but has a much higher level of security,” he said

Babylon is currently integrated with 16 different app chains on their testnets valued at $1.4 billion. These 16 different app chains are secured with Bitcoin’s $600 billion.

Beyond the cosmos

Babylon currently exists as a testnet and plans to launch its mainnet in Q3 or A4, Tse said.

The Cosmos ecosystem has been the focus for a number of reasons – most notably its powerful interoperability capabilities through the inter-blockchain communication protocol (IBC) that enables automatic timestamping of all these chains to Babylon, but also because of the diverse ecosystem of the app chain.

“This gives us very broad exposure to different types of applications… We learn quite a bit by working with them and understanding how they want to use Bitcoin security,” said Tse.

While this is the case, Babylon is also looking at ways to expand beyond the cosmos. This is currently being explored in two different directions, one of which is deploying smart contracts on Babylon that create timestamps.

“This allows us to go outside of the Cosmos ecosystem… it doesn’t even have to be chains, it can be specific applications running on Ethereum that want additional security,” Tse said. “Bitcoin is very powerful, very secure, but it has a very big limitation… which is that it doesn’t have smart contracts, so Babylon handles the hard work of interacting with the not-so-smart chain Bitcoin and allows it to communicate with the rest of the world.”

The second direction, Tse notes, is to integrate with interoperable chains, such as Axelar.

“Axelar is interoperable with many chains outside the cosmos, then we can get timestamps for all these chains that Axelar is integrated with as well,” he said.

Using Bitcoin security to build dapp projects

Rather than competing directly with Ethereum, Tse believes it is possible to bring existing proof-of-stake chains to an even more secure Bitcoin through interoperability.

“Ethereum has been very successful in building an ecosystem that contains brilliant new technology,” said Tse. “So what we’re saying here is that Bitcoin is an arguably even more secure chain and has a 14-year history.”

Babylon is not the only project Tse and his team are working on.

Using ordinal technology, Tse and his team are currently exploring ways to leverage Bitcoin block space to eliminate transaction censorship on proof-of-stake chains.

“You could place these trades on the Bitcoin block space and because Bitcoin has [a] very strong trait of resistance to censorship, which would allow that transaction to survive censorship… that’s another type of protocol that’s on our roadmap,” Tse said.

Read more: Proof-of-Work vs. Proof-of-Stake: Which is Better?

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