What is Lombard?

Lombard is a decentralized protocol transforming Bitcoin’s role from a passive store of value into a productive financial asset by introducing LBTC, a security-first liquid staked Bitcoin token. Built on Babylon’s staking infrastructure, LBTC allows Bitcoin holders to earn yield while maintaining liquidity for DeFi participation. At the heart of Lombard’s design is its Security Consortium, a decentralized group of industry-leading organizations that validate and oversee critical protocol operations, including BTC staking, LBTC minting, and cross-chain transactions. This multi-party governance framework minimizes counterparty risk, enhances security, and ensures the integrity of LBTC within the broader DeFi ecosystem. With LBTC, users can seamlessly integrate Bitcoin into DeFi, participating in lending, trading, and liquidity provision while benefiting from secure and scalable staking infrastructure.

What are the risks?

While Lombard unlocks new utility for Bitcoin, it carries several key risks. Slashing risk arises if Babylon validators misbehave or fail to perform their duties, potentially resulting in the loss of staked BTC, though slashing is not yet live. Depeg risk may occur during volatile market conditions or due to the 9-day unstaking period, causing LBTC to trade at a premium or discount relative to BTC, although users can always redeem LBTC for BTC at a 1:1 rate via Lombard’s WebApp. Technical risks include potential vulnerabilities in smart contracts, network attacks, or unforeseen bugs, which Lombard mitigates through extensive audits, bug bounties, and real-time monitoring. Additionally, liquidity risk could arise during extreme market events if demand for LBTC liquidity temporarily exceeds supply, impacting its usability. Lombard addresses these risks with robust security measures, including decentralized transaction validation through its Security Consortium and multi-party governance protocols.

How you make money on Lombard

BTC stakers earn native yield through Babylon’s staking mechanism while maintaining liquidity via LBTC. LBTC holders can earn additional rewards, including Lombard Points for early participation and yield from DeFi integrations such as lending, borrowing, and liquidity provision. By combining Bitcoin’s stability with Babylon’s yield opportunities, users benefit from low-risk, yield-bearing BTC exposure.