The full picture of Starknet's BTCfi strategy as Bitcoin staking officially kicks off

On August 21, 2024, the SNIP-31 proposal was approved through a community vote on Starknet. This decision paves the way for the introduction of a Bitcoin staking mechanism on the layer 2 network. Supported by 93% of voters, this milestone symbolizes the deepening integration of Starknet(STRK) and Bitcoin(BTC).

Structure of the Staking Mechanism — Coexistence Design of STRK and BTC

The unified staking system established by SNIP-31 will realize a unique framework where both assets share governance rights. While the staking power of BTC is limited to 25% of the total governance influence, STRK secures the remaining 75%. This ratio setting fosters the integration of cross-chain assets while maintaining network sovereignty.

The reward mechanism is cleverly designed. It preserves the existing STRK reward base through new token issuance while stacking an incentive layer for Bitcoin holders. This creates an environment where both parties can enjoy rewards simultaneously.

Initially, only mainstream wrapped tokens such as WBTC, LBTC, tBTC, and SolvBTC will be approved for staking. The addition of new BTC-derived assets in the future will require a two-step process: community voting approval and activation by the Financial Committee. This governance design balances security and transparency.

Advancing to a Core Player in the BTCfi Ecosystem

The introduction of the Bitcoin staking mechanism positions Starknet as a vital infrastructure provider within the rapidly growing BTCfi sector. This strategy promotes cross-chain participation within the network and creates an environment where BTC holders can earn rewards in STRK.

From a liquidity deepening perspective, it is also significant. The design eliminates dependence on the BTC/STRK exchange rate, reducing systemic risk and enhancing stability. The developer community highly appreciates the simplicity and robustness of this mechanism.

Meanwhile, Starknet is preparing to launch a perpetual derivative DEX and is also promoting collaboration with the travel booking platform Travala, accelerating ecosystem expansion in the DeFi space.

Technological Innovation — Balancing Scalability and Decentralization

The rollout of version 0.14.0 on September 1 marks a key milestone in Starknet’s technological evolution. The introduction of Tendermint consensus for decentralized sequencing significantly enhances the network’s resistance to censorship.

Shortening block times (from the current 4–6 seconds) and improving pre-commitment speeds will dramatically enhance transaction processing efficiency. Additionally, a new fee market mechanism modeled after Ethereum’s EIP-1559 aims to achieve both predictable pricing and market efficiency.

Market Response — Balancing Expectations and Caution

Immediately after approval, STRK dropped by 6.2%. This suggests that investors are re-evaluating Starknet’s true value as the Bitcoin staking feature moves closer to implementation. The gap between the technological roadmap’s richness and market valuation has likely caused this adjustment.

The current price trend of STRK and its correlation with BTC (at the $90.57K level), along with the maturity of the market mechanism, will be key factors in the future development of the ecosystem.