Bitcoin collateral docking institutional credit
Lombard Finance has launched its Bitcoin chain credit strategy, opening up a new way for institutional investors to use Bitcoin as collateral to gain stablecoin liquidity. The product allows LBTC and native BTC holders to earn a fixed premium by providing collateral to support institutional stablecoin credit lines.
This strategy provides a way for regulated agencies to use Bitcoin as collateral and borrow stablecoins through a private underwriting structure in the Cap automated credit market. The strategy leverages Chainlink's cross-chain interoperability protocol CCIP to deposit BTC.b deposits from Avalanche into vaults running on Ethereum, thereby reducing the need for investors to manually bridge, redeem or reissue their bitcoin-related assets before entering the strategy.
Lombard has previously selected CCIP as the exclusive interoperability system for more than $1 billion of bitcoin-backed assets, including LBTC and BTC.b.
Flow Traders as the first counterparty to go online
Flow Traders is one of the most well-known companies in the field of institutional digital asset trading and serves as a pilot partner for the launch of this strategy. Founded in 2004, Flow Traders is a leading multi-asset market maker and liquidity provider and has been listed on the Euronext Amsterdam Stock Exchange since 2015. The company handles billions of dollars in daily trading volume and is one of the leading market makers in ETFs, ETP, equities, fixed income, commodities and cryptocurrencies.
This cooperation allows regulated institutions to obtain decentralized capital in a fully functional, traceable, and automated and secure manner, marking an important shift from watching DeFi to using it for specific financial operations.
Lombard was founded in 2024 and is the first to integrate Bitcoin into DeFi through LBTC. LBTC is the leading income-bearing Bitcoin asset, secured by a consortium of 14 digital asset institutions. LBTC reached a total lock-in value (TVL) of US$1 billion in just 92 days and became the first Bitcoin liquidity pledge token (LST) trusted by blue-chip agreements such as Aave, Spark, and EigenLayer. The protocol runs on Ethereum, Base and Solana, which is critical because institutional configurators increasingly want cross-chain exposure without having to manage the complex operations of bridging assets themselves.

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