Interpretation of Chakra: Using zero-knowledge proof to provide safe re-pledge income for Bitcoin

php Editor’s Banana Chakra project is committed to using zero-knowledge proof technology to provide more secure re-pledge benefits for Bitcoin. By having a deeper understanding of how Chakra works and its advantages, you can better grasp investment opportunities in the Bitcoin market while ensuring asset security and data privacy. This article will provide a detailed explanation of the Chakra project to help readers fully understand its operating mechanism and potential risks, and provide more reference for investment decisions.

Written by: Chakra

Compiled by: Deep Wave TechFlow

Introduced

With the market recovery, Bitcoin’s current market value has reached an astonishing 1 trillion dollars, it has positioned itself as a form of digital gold. Currently, however, it is mostly an idle asset. Most Bitcoins sit motionless in users’ cold wallets and various exchanges around the world, rather than actively participating in the blockchain network or generating benefits for holders. Therefore, Bitcoin’s potential extends far beyond its current uses and applications.

The Chakra protocol aims to establish a secure Bitcoin proof-of-stake system to activate long-term Bitcoin asset liquidity and provide decentralized services maintained by asset holders. As a Bitcoin re-hypothecation protocol, its goal is to combine a powerful blockchain network, secure new chains and applications, and apply cutting-edge zero-knowledge proof technology to unleash the economic potential of Bitcoin holders.

The challenges are obvious. Bitcoin holders are eager to benefit from staking returns without compromising the security of their Bitcoins.

How Chakra Works

The Chakra protocol helps solve this problem. Using the Chakra protocol, Bitcoin holders can safely earn a variety of benefits without worrying about the security of their pledges.

What is unique about the Chakra protocol regarding Bitcoin re-staking?

Self-Custody Staking

Trust in Bitcoin is built on its highly decentralized and extremely secure nature. Therefore, sacrificing security in pursuit of staking yields may cause significant concerns. Our proposed solution allows Bitcoin holders to stake without having to move their assets out of their personal wallets. This solution is implemented through time-locked scripts, ensuring that no third-party risks are involved.

ZK-based Staking Proof

In our solution, Bitcoin’s staking events are proven through zero-knowledge proofs that can be verified off-chain to access on-chain information , without connecting to the Bitcoin network. We will use STARK to implement the proof system. Compared with SNARK, STARK provides a zero-knowledge proof solution that does not require a trusted setup, while its mechanism ensures enhanced security.

Re-pledge service

The pledge proof can be verified in various places, grant multiple rights to the pledger, and provide a series of services maintained by the pledger. Each right or service can be customized to meet specific needs such as AI, DeFi, gaming, etc., all facilitated and secured by Bitcoin holders. Bitcoin holders only need to stake once and then they are empowered to scale Bitcoin in many ways.

Chakra’s Applications

The Chakra protocol supports a variety of Bitcoin applications, taking advantage of Bitcoin’s powerful security while releasing the liquidity of Bitcoin assets.

Bootstrap the new Bitcoin Layer 2

Proofs of staking can be verified on Bitcoin Layer 2, allowing stakers to participate in Layer 2 Consensus and governance. These second layers share Bitcoin’s security, providing data availability services and execution environments maintained by stakers. For example, we could launch a Bitcoin layer 2 maintained by stakers and run with the Cairo VM.

Brings various benefits to pledgers

Proof of pledge can be used to create derivatives of Bitcoin assets, allowing users to use Bitcoin in DeFi protocols Supported assets provide opportunities. For example, similar to stETH in the Ethereum ecosystem, we can use the Chakra protocol to issue stBTC and build DApps to interact with it.

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