Babylon Raises $15M from a16z to Unlock Non-Custodial Bitcoin DeFi

Babylon raised $15 million from a16z Crypto to develop BTCVaults, enabling non-custodial Bitcoin collateralization for DeFi. The protocol uses advanced cryptography to keep BTC secure and productive on-chain.

Babylon has secured a $15 million investment from a16z Crypto to advance its BTCVaults protocol, which enables native Bitcoin to be used as on-chain collateral without requiring custodial transfers or synthetic representations. This funding brings Babylon’s total disclosed capital to $103 million and will accelerate the development of trustless Bitcoin vaults, allowing users to lock BTC directly on the Bitcoin blockchain. The BTCVaults system leverages cryptographic tools such as zero-knowledge proofs, witness encryption, and garbled circuits to ensure that Bitcoin remains verifiably locked and under user control, while enabling integration with DeFi applications like lending, stablecoins, and insurance. The BABY token’s role will expand within the ecosystem to support coordination and participation. Babylon’s approach targets both institutional and sophisticated retail investors, aiming to unlock over $1.4 trillion in idle Bitcoin by providing a non-custodial, productive use case for BTC in decentralized finance. The company’s academic roots are reflected in its research-driven, protocol-focused development model.