BitGo Launches Support for Bitcoin L2 Stacks and sBTC
Digital asset services infrastructure provider BitGo has launched support for the Bitcoin layer2 network Stacks and its new token standard, sBTC, to enhance BTC’s functionality with stacking capabilities.
According to a press release sent to CryptoPotato, BitGo will join the Stacks network as a Signer, contributing to blockchain consensus and block production.
BitGo Integrates Support for Stacks
The alliance between BitGo and Stacks allows the former’s users to grow their Bitcoin holdings without lending their assets. They can generate bitcoin (BTC) rewards in their wallets by using Stacks’ sBTC.
sBTC is a decentralized 1:1 Bitcoin-backed asset created to enhance Bitcoin’s programmability and BitGo will facilitate the deposits and withdrawals of the asset from Stacks. As a Signer on Stacks, BitGo will enable the conversion between BTC and sBTC across Bitcoin’s layer1 and layer2 networks.
Users who want to create sBTC must deposit an equal amount of BTC into a Bitcoin blockchain script controlled by BitGo or other Signers. BitGo will then mint the sBTC and move it to the users’ addresses. The infrastructure provider follows a similar process when users convert their sBTC to BTC by initiating a peg-out transaction and sending the redeemed BTC to the appropriate addresses.
BitGo’s Senior Product Manager, Daniel Du, said: “BitGo is pleased to support Stacks in expanding their smart contract capabilities and decentralized applications for builders and institutions alike. We are proud to provide regulated qualified custody and stacking of STX, and we look forward to partnering with them in their future advancements.”
Building on Bitcoin
The latest development comes as developers and the Bitcoin community seek to unlock the potential of the leading crypto network. With developers looking for new ways to build on Bitcoin, the network’s total value locked has grown 7x to more than $2.2 billion. BitGo believes its participation as a Signer for Stacks would encourage Bitcoin layer2 developers to innovate more.
“This move underscores the critical role that Bitcoin L2s, with Stacks leading among them, will play in expanding the Bitcoin ecosystem and driving future innovation,” said Jonathan Sadlowe, General Partner at Gossamer Capital, an early-stage venture capital fund investing in the blockchain ecosystem.
Investors and institutions are also looking to tap into Bitcoin’s potential. Several entities have increased their allocation to Bitcoin-based projects through direct investments and the launch of accelerator programs geared toward Bitcoin-building teams.
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