For most of its history, Bitcoin has been priced as digital gold: an asset held instead of use. That passivity leaves trillion value of the dollar amount of BTC sitting in purses, which -Disconnect from yield and composability techniques that define decentralized finances (Defi).
Increasing liquid staking tokens promises to change that, positioning Bitcoin not only as a value store but as a productive possession integrated into onchain capital markets.
Liquid staking refers to the process of equipment that offers their crypto to help secure a network, and receive a liquid, tradable token in return representing their staked assets and can be used throughout the DeFI as the original tokens continue to earn staking rewards.
Lombard Finance has emerged as one of the most well -known projects in Bitcoin Liquid Staking. Its flagship product, LBTC, is a token that carries a 1: 1 yield of BTC.
When the BTC is deposited in the Lombard protocol, the underlying coins are staked, especially by Babylon, a protocol that enables unbelievable, self-customial bitcoin staking. Users receive LBTC in return, which can be deployed throughout the Defi Ecosystem while the original Bitcoin earns rewards.
This dual function is key. Holders can maintain exposure to Bitcoin while using LBTC to lend, borrow, and provide liquidity throughout protocols such as Aave, Morpho, Pendle, and Ether.Fi. Designed for interoperability, LBTC moves throughout Ethereum, base, BNB chains, and other networks, which prevents the destruction of liquidity and ensures that bitcoin can participate in a multi-chain defi environment.
A market potentially worth billions -billion
By mobilizing BTC’s dormant liquidity, Lombard and other liquid staking projects aim to provide infrastructure for the Bitcoin Defi, which submits a wide market cap to the Onchain Capital Markets.
This effort reflects Ethereum’s own transformation through liquid staking derivatives, but has the potential to unlock a deeper pool of value given on the Bitcoin scale.
To contextualize the difference in the scale, Ethereum’s liquid staking market, led by Lido’s steth, Boasts a market cap of approximately $ 38 billion. In contrast, the entire sector of Bitcoin LST is still nascent, including Total market capitalization around $ 2.5 billion. Only Lombard’s LBTC provides nearly $ 1.4 billion, or around 40% of the Bitcoin LST market.
Lombard’s bard
Building that foundation, Lombard announced this week The creation of Liquid Bitcoin Foundation and its native $ bard tokennext to a $ 6.75 million community sale.
The foundation will act as an independent protocol steward, funding research, grants, and education, while establishing management frameworks to maintain neutrality. The $ bard will serve as the utility and management of the ecosystem token, which provides holders of the ability to stake to secure Lombard’s basic infrastructure, vote on proposals, and get access to new products.
Jacob Phillips, Lombard co-founder described the sale of the community as “an invitation to more than 260,000 LBTC holders and others in the Bitcoin ecosystem to help shape the future of Bitcoin Onchain.” Erick Zhang, founder of Buidlpad who hosts the sale, added that Lombard is “a pioneer who unlocks the full potential of Bitcoin as digital gold and a foundation for the next Gen Capital Market.”
