Skip to main content

Staking via CLI Tools

This guide provides a simplified step by step guide of how to stake, unbond, and withdraw BTC using the CLI tools.

BTC-Staker​

(BTC-Staker)[https://github.com/babylonlabs-io/btc-staker] is a tool that allows you to participate in native Bitcoin staking. It also allows operators to do it programmatically. It consists of two parts:

  • stakerd: The background program that manages connections to the Bitcoin and Babylon networks.
  • stakercli: The command-line tool you use to interact with stakerd.

Prerequisites​

  • Go: Make sure you have Go version 1.21 or later installed.

Step 1: Setting Up Your Bitcoin Node​

  1. Download Bitcoin Core: Download and extract the Bitcoin Core binaries.
  2. Configure Bitcoin: Create a bitcoind.service file and configure it with your RPC username, password, and other settings. Make sure to enable the creation of a legacy wallet.
  3. Start Bitcoin Node: Start the Bitcoin node using systemctl.
  4. Create a Legacy Wallet: Create a legacy wallet using the createwallet command. Make sure to set a wallet name and passphrase.
  5. Load the Wallet: Load the wallet using the loadwallet command.
  6. Generate a New Address: Generate a new Bitcoin address for your wallet using the getnewaddress command.
  7. Get Testnet BTC: Request testnet BTC from the Discord #faucet-signet-btc channel and send it to the address you have generated.

Step 2: Installing BTC-Staker​

  1. Clone the Repository: Clone the BTC-Staker repository from GitHub:

    git clone https://github.com/babylonlabs-io/btc-staker.git
    cd btc-staker

  2. Checkout a Release: Choose a specific version from the official releases page and check it out:

    git checkout v0.15.4

  3. Build and Install: Build and install the stakerd and stakercli binaries:

    make install

  4. Create a Babylon Keyring: Follow instructions to create baby key-ring, then go to L2Scan Babylon Testnet Faucet to request funds.

Step 3: Configuring BTC-Staker​

  1. Dump Default Configuration: Initialize the home directory for the Staker Daemon and dump the default configuration file:

    stakercli admin dump-config --config-file-dir /path/to/stakerd-home/

  2. Edit stakerd.conf: Edit the stakerd.conf file located in your stakerd home directory. Pay attention to the following sections:

    • [babylon]: Configure your Babylon Genesis Chain ID, RPC address, GRPC address, and keyring settings.
    • [chain]: Set the BTC network to signet or mainnet.
    • [btcnodebackend]: Set the node type to bitcoind and wallet type to bitcoind.
    • [walletconfig]: Set the wallet name and passphrase to match what you configured in your Bitcoin node.
    • [walletrpcconfig]: Configure the RPC connection details for your Bitcoin wallet.
    • [bitcoind]: Configure the RPC connection details for your Bitcoin node.

Step 4: Running BTC-Staker​

  1. Start the Daemon: Start the stakerd daemon:

    stakerd --rpclisten 'localhost:15812'

Step 5: Staking Operations​

1. Stake Bitcoin​

  1. List Finality Providers: Find the BTC public key of the Finality Provider you want to stake to:

    stakercli daemon babylon-finality-providers

  2. List Outputs: Find the BTC address with enough balance:

    stakercli daemon list-outputs

  3. Stake: Stake your Bitcoin:

    stakercli daemon stake \
      --staker-address <your_btc_address> \
      --staking-amount <amount_in_satoshis> \
      --finality-providers-pks <finality_provider_btc_pubkey> \
      --staking-time <lock_time_in_blocks>

2. Unbond Staked Funds​

  • Unbond: Initiate the unbonding process:

    stakercli daemon unbond \
      --staking-transaction-hash <staking_tx_hash>

3. Withdraw Staked Funds​

  • Withdraw: After the timelock expires, withdraw your funds:

    stakercli daemon unstake \
      --staking-transaction-hash <staking_tx_hash>

Important Notes:

  • Make sure your Bitcoin node is running on the same network as the Babylon node (Signet for the testnet, Mainnet for the Babylon Genesis Mainnet).
  • Ensure you are using a legacy (non-descriptor) wallet.
  • You must wait for the timelock to expire before you can withdraw your funds.