Lombard’s Grand Roadmap to Activate Bitcoin Onchain

Key Takeaways

• As institutional interest in crypto assets continues to rise, Lombard has drawn significant attention for pioneering the activation of Bitcoin onchain in just a short amount of time with LBTC’.

• Building on a strategy and partnerships focused on security & stability, scalability, usability, and distribution, Lombard established LBTC as the leading BTC LST within just one year of launch—successfully completing the first of its three roadmap phases—and is now preparing for the second by developing a range of BTC-based products and infrastructure to build a full-stack ecosystem architecture for Bitcoin capital markets onchain.

• As institutional adoption of Bitcoin becomes an unstoppable trend, opportunities for them to activate their Bitcoin onchain will become an especially compelling market, with Lombard at its core as it advances through the final stage of its roadmap to become the foundational layer of the Bitcoin economy.

1. Introduction

Institutional interest in crypto asset exposure has been steadily growing. More and more, institutions are building regulatory-compliant custody frameworks and rapidly establishing structures that allow them to generate additional yield onchain. They are moving beyond simple products like trusts and ETFs backed by underlying assets, and are now expanding into natively staked tokens and other onchain instruments in various forms(e.g., 21Shares’ Ethereum Staking ETP, stETH custody support by Galaxy’s subsidiary GK8, the recognition of stETH as collateral in options and structured product trading on Caladan, etc).

As institutions increasingly seek to operate their assets more strategically and efficiently to capture additional yield, this trend will only accelerate. This shift marks an inflection point: the focus is no longer on simply holding native tokens, but on finding structured mechanisms that unlock smarter, more productive ways to deploy them.

Amid this backdrop, Lombard has recently attracted significant attention for awakening Bitcoin’s vast dormant liquidity of over $2 trillion and, in just over a year, pioneering and leading integration and activation of Bitcoin in DeFi with its Bitcoin Liquid Staking Token (LST), LBTC.

This article explores how Lombard, since the launch of LBTC, has opened the first chapter in Bitcoin’s expansion onchain through its achievements over the past year. It also looks ahead to Lombard’s roadmap as it moves beyond LBTC—introducing a broader suite of BTC-based products and building a full-stack architecture to evolve into a platform for others to innovate with Bitcoin. In doing so, it examines what the future Bitcoin economy might look like, and how Lombard is positioning itself to become a central player at its core.

2. Lombard Opens the Era of True Onchain Bitcoin Finance with LBTC

Unlike most smart contract platforms, Bitcoin was designed as a PoW (Proof-of-Work) blockchain with no concept of staking, which made the very idea of LSTs impossible. Moreover, to minimize potential security risks, Bitcoin’s scripting language was deliberately limited, making it impossible to implement complex DeFi functions. As a result, even though institutional demand for more native BTC use cases surged, past attempts to activate liquidity through Bitcoin L2s or sidechains struggled to gain traction, since they could not leverage Bitcoin’s security fully.

This changed in late 2024, when Babylon introduced a Bitcoin staking protocol that enables native BTC staking and rewards while simultaneously enhancing the security of other PoS chains. With this breakthrough, the foundations of a Bitcoin-based LST market began to take shape, and various players like Lombard and Solv Protocol quickly emerged, marking a turning point for BTCFi - a new path had opened for the permissionless use of native BTC–backed assets across on-chain protocols.

The impact was clear: according to DeFiLlama, Bitcoin DeFi’s TVL—which had remained below $500 million in early 2024—has now grown to around $7.5 billion, with roughly 76% ($5.77 billion) staked through Babylon and the remainder largely represented by LBTC issued by Lombard.

Of course, other tokenized forms of BTC other than onchain BTC LST assets included above exist, such as WBTC, BTCB, and cbBTC. These assets are centralized representations of Bitcoin bridged into smart contract networks, and together they account for more than 250,000 BTC—far more than the ~14,000 BTC by Lombard’s LBTC. Yet these BTC LST assets have rapidly gained market share because, unlike such centralized wrappers, they circulate in a decentralized and permissionless environment while inheriting Bitcoin’s security guarantees. This distinction resonates strongly with long-term Bitcoin holders, who are wary of centralized risks and reluctant to compromise the asset’s “digital gold” ethos. In addition, especially assets like BTCB remain locally useful within their issuing platforms, they have not spread widely across multi-chain DeFi.

Lombard’s LBTC, by contrast, has an 82% asset utilization across DeFi and is on 13 chains. It gets yield from staking the underlying BTC to Babylon*, which will not only to reinforce the security of various Proof-of-Stake networks (i.e., Bitcoin Secured Networks, BSNs) but also to capture and reflect the additional rewards generated in the process directly into its value. Beyond that, it stands as the exclusive bridge for BTC LST to flow seamlessly across the broader DeFi ecosystem, establishing the first permissionless gateway for Bitcoin into DeFi. In this way, LBTC not only inherits Bitcoin’s inherent security but also creates powerful new demand for staked Bitcoin, positioning itself as a key catalyst in bringing Bitcoin onchain to the forefront.

*Babylon’s staking protocol achieves this by allowing Finality Providers to timestamp directly onto the Bitcoin network through the coordination layer of the Babylon chain. This design secures a level of protection that is as close as possible to native Bitcoin itself, enabling true native BTC staking and unlocking the ability to leverage those staked assets across the broader ecosystem.

Consequently, Lombard is the largest finality provider** on the Babylon network, and its LBTC has unlocked roughly 14,000 BTC in liquidity, securing a dominant market share of over 57% among BTC LST assets.

Through collaborations with a wide range of institutions and protocols, LBTC is securely circulating across a multi-chain environment and is now integrated with more than 70 protocols—including Aave, EigenLayer, Curve, Spark, Maple, Morpho, Etherfi across 13 chains. This has enabled LBTC to surpass $2 billion in TVL, establishing it as the clear leader in the Bitcoin LST sector in terms of both market share and onchain utilization.

**Lombard partners with major global staking operators such as Figment, Galaxy, Kiln, and P2P to strengthen the overall resilience, stability, and trust of the network.

3. Evolving Beyond LBTC Into a Comprehensive Platform for Bitcoin Capital Markets Onchain

However, simply issuing and circulating an LST is not enough to create meaning beyond merely integrating into the existing DeFi ecosystem. In other words, unlocking a new Bitcoin economy centered on on-chain BTC assets requires that Bitcoin itself become the foundation for diverse monetization strategies, supported by robust infrastructure. And Lombard is positioning itself as the unique, leading player taking on exactly that role.

Under a clear vision to establish itself at the center of the Bitcoin economy, Lombard is carrying out a three-phase roadmap.

3.1 Phase I: Activate Liquidity

Lombard has moved beyond LBTC, creating a suite of Bitcoin-focused products designed to generate diverse yield opportunities. It has successfully completed the first phase of its roadmap—“Activate Liquidity”—establishing the foundation for these assets to circulate securely and broadly across multiple platforms.

A DeFi Marketplace Showcasing a Broad Product Suite

To start, Lombard is building and expanding a DeFi marketplace that integrates yield opportunities across DeFi, CeFi, and TradFi. A key example is the Lombard DeFi Vault, developed in partnership with Veda. With a single deposit, the vault automates strategy selection, cross-chain execution, real-time rebalancing, and reward aggregation—allowing users to manage their Bitcoin assets efficiently without manual intervention. It supports not only LBTC but also wBTC, eBTC, and cbBTC deposits. In return, users receive LBTCv tokens, which are distributed across strategies such as liquidity provision on Uniswap and Curve, lending via Gearbox and Morpho, and yield trading on Pendle. Rewards are auto-compounded, withdrawals are fully flexible, and all activity can be tracked intuitively through a dashboard.

Lombard has also partnered with Etherfi to launch eBTC, the first-ever Bitcoin LRT, which is also onboarded as collateral on Aave. eBTC enables users to mint LBTC which currently earns 1% yield from Babylon's staking rewards, while simultaneously restaking across EigenLayer, Symbiotic, and Karak—creating a dual-yield product that combines staking and restaking returns together. For Katana, Lombard also released BTCK, an permissionless BTC wrapper designed under the same framework as LBTC, but without staking to Babylon.

Other than them, Lombard plans to roll out a broader range of structured and tokenized products, including basis trade vaults, option vaults, staking ETFs/ETPs, and treasury management solutions for institutional investors.

Expanding Native Utility and Accessibility

The products launched by Lombard are being adopted across protocols with real demand for each asset, spreading throughout the multi-chain ecosystem and enhancing native utility and accessibility.

For instance, LBTC is now integrated across 13 chains, with over $1 billion deployed into major DeFi protocols. On Maple Finance, it serves as institutional collateral for fixed-rate lending; on Pendle Finance, it powers yield strategies; on Morpho, Gearbox, and ZeroLend, it is used as collateral for lending; and on Derive, it functions as an underlying asset for options trading. Notably, through a recent partnership with the Eigen Foundation, LBTC became the first and only Bitcoin asset integrated into the EigenLayer restaking ecosystem, unlocking a dual-yield structure that combines Babylon staking rewards with restaking incentives.

Securely Backed Product Suite

The expanded ecosystem is safeguarded on both security and governance fronts by the Lombard Security Consortium. This consortium is composed of leading crypto institutions—including market makers, mining pools, validators, and technology providers—and ensures that all transactions (minting, redemption, staking/unstaking, bridging, etc.) are approved through a consensus process. It is implemented via the Lombard Ledger, a Cosmos app-chain based on PoA, while cross-chain transfers undergo dual validation by Chainlink CCIP oracles and the consortium to minimize the risk of unauthorized issuance.

Key management for such assets is secured through Cubist’s CubeSigner protocol, which provides hardware-level isolation to protect against insider threats and key leakage. The codebase undergoes recurring audits by top security specialists such as Cantina, Veridise, Halborn, OpenZeppelin, and Sherlock, while a continuous bug bounty program with Immunefi and real-time runtime monitoring by Hexagate further reinforce the defense layer. In addition, TRM and Elliptic screening are employed to filter sanctioned addresses and block risks associated with money laundering or illicit activity.

On the transparency front, Lombard has introduced a Proof of Reserves (PoR) Oracle in collaboration with RedStone and Chainlink. This allows for real-time verification of the financial soundness and reserve status of Lombard’s assets.

3.2 Phase II: Bitcoin Capital Markets

Source: Lombard Blog

Lombard is currently advancing into Phase II, focused on building the capital markets layer. The core of this stage is to move away from fragmentation and exponentially expand liquidity through aggregation and distribution. To achieve this, Lombard is developing a full-stack ecosystem architecture that enables the diverse assets established and secured in Phase I to be more easily utilized and integrated across any platform. This includes ongoing enhancements to the Lombard Ledger, alongside preparations for the launch of a permissionless wrapped Bitcoin derivative and the introduction of various infrastructure components, all aimed at creating an environment where Lombard assets can be seamlessly integrated and utilized across multiple platforms.

A prime example is the Lombard SDK, a toolkit that allows exchanges, wallets, and platforms to integrate features such as one-click Bitcoin staking (BTC → LBTC minting) and automated DeFi vault deposits with just a few lines of code. Built on top of the Lombard Ledger, the SDK ensures that yield strategies executed through Lombard’s DeFi marketplace can be easily connected and deployed within external platforms. Major partners including Binance, Bybit, and XVerse have already integrated the SDK into their Web3 wallet interfaces, while Kiln and Ledger Live are expected to complete integration in the coming months.

3.3 Phase III: The Bitcoin Economy

Following the advancement of Phase II, Lombard will move into the final stage: Phase III. The objective of this phase is to establish open standards, modular infrastructure, and trustless bridging that anyone can access and build upon. In other words, it represents the point at which Lombard abstracts its full-stack infrastructure to support developers and applications leveraging native Bitcoin assets.

Through this phase, Lombard ultimately aims to position itself as the core base layer for onchain finance built on Bitcoin, much like how Tether and Circle laid the technical and liquidity foundations for the stablecoin market within the broader onchain ecosystem.

4. Onchain Bitcoin Economy Will Be Driven by Native BTC Infrastructure Players

In just over a year, Lombard has redefined and taken the lead in the onchain Bitcoin market. Its roadmap clearly reflects the belief that expanding and innovating onchain Bitcoin requires, above all, the establishment of capital market infrastructure anchored in Bitcoin’s deep liquidity.

Sixteen years after Bitcoin’s launch, and a decade since the first smart contract platform emerged, only around 1% of Bitcoin’s supply—roughly $2 trillion worth—has been utilized onchain. This underutilization is the direct result of Bitcoin network’s inherent technical limitations and the absence of supporting infrastructure, leaving vast liquidity dormant.

Lombard addresses this challenge head-on. Unlike previous Bitcoin sidechains or L2 solutions that achieved only limited usability and security while attempting to build a partial form of BTC economy, Lombard is focused on dedicated infrastructure designed from the ground up for on-chain use of Bitcoin assets themselves. Its first product, LBTC, has already demonstrated that native BTC asset can function as a yield-bearing asset and circulate seamlessly across platforms. Building on this foundation, Lombard is developing a suite of other native BTC products and a full-stack ecosystem architecture, paving the way for a true Bitcoin capital market.

As institutional adoption of Bitcoin becomes an unstoppable trend, ecosystems that harness native BTC will emerge as both the most attractive and, in practice, the only viable option. In this context, the awakening of Bitcoin’s dormant liquidity and the realization of genuine Bitcoin economy are likely to be led by Lombard, which is rapidly constructing a full-stack, Bitcoin-centered ecosystem.

5. Resource

Related Articles, News, Tweets etc. :

• Dune Dashboard (Lombard)

• Lombard’s Docs

• Lombard’s Blog

• SEC Division's View on Liquid Staking Has ‘Opened Up the Floodgates’ for Institutions

• stETH custody support by Galaxy’s subsidiary GK8

• The recognition of stETH as collateral in options and structured product trading on Caladan

• 21Shares’ Ethereum Staking ETP