What Is Bitcoin Yield?

While Bitcoin was originally created as a store of value, the world of crypto has progressed by leaps and bounds since, giving way to an abundance of DeFi protocols with complex and inventive ways for users to earn passive income with their crypto. Staking, for example, offered a new way for users to earn rewards simply by locking up specific cryptocurrencies to secure those networks.

As a proof-of-work network that doesn’t rely on staking, earning rewards wasn’t previously viable for Bitcoin. However, the DeFi ecosystem and supporting protocols have since evolved to bring these opportunities to the Bitcoin network. Now, earning yield on your Bitcoin is a popular and accessible way to generate passive income while maintaining your long-term position.

In this article, we’ll explore what Bitcoin yield is, why it is an important tool for holders, and how you can access pioneering yield opportunities through Lombard and Ledger Wallet.

What Is Bitcoin Yield?

Before we explain what Bitcoin yield is, let’s define yield generally within the context of finance. In short, yield refers to the return on investment (ROI) that an investor receives on their investment over a specific time period. It’s generally expressed as a percentage of the overall value of the investment. 

Yield is an important consideration in any investment, considering that the opportunity to generate passive income is a common goal of most investors, both in traditional and decentralized finance (tradFi and DeFi). 

So, Bitcoin yield is a broad term that refers to any ROI that you might earn while holding Bitcoin. Naturally, the simplest way to grow wealth on Bitcoin is via price appreciation. For this, you simply buy and hodl, and you see ROI if the price of Bitcoin goes up relative to its price when you bought it.

Of course, the world of DeFi has expanded substantially since Bitcoin’s inception as a store of value. Today, there are many methods of generating yield on crypto, creating additional income opportunities for holders.

What Earning Yield Means for Users 

Generating yield is a central goal for many investors because it can potentially transform a static asset into a productive one. In the digital asset space, earning yield serves several key purposes:

• Passive Reward*: It allows you to grow your portfolio without needing to actively trade or time the market.
• Outperforming the Market: By earning yield on top of price appreciation, investors can achieve an ROI that outperforms the price action of the underlying asset alone.
• Utility: DeFi yield protocols often provide liquid tokens in return for your deposit, allowing you to participate in other DeFi activities while your original assets continue to earn rewards.

*Disclaimer: Rewards are not guaranteed. 

How to Earn Bitcoin Yield with Lombard

As the Bitcoin ecosystem expands, new infrastructure is making it easier to earn rewards. The most prominent example of this is the yield protocol, Lombard.

What is Lombard?

Lombard is a Bitcoin infrastructure company building the onchain capital markets for Bitcoin. Its mission: transform Bitcoin from the world’s largest idle asset into productive, yield-bearing capital that moves freely across the onchain economy.

Launched in 2024, Lombard has become the category leader in onchain Bitcoin finance — onboarding over $3 billion in previously dormant BTC and reaching $1 billion in TVL in just 92 days, faster than any yield-bearing token in crypto history.

LBTC: Yield-Bearing Bitcoin

Lombard’s flagship product is LBTC, the market-leading yield-bearing Bitcoin asset. When you deposit BTC into Lombard, you receive LBTC — a token that is fully backed by Bitcoin and automatically accrues yield over time. You don’t claim rewards manually; the value of LBTC in BTC simply grows as yield accumulates.

That yield has a straightforward source. Your underlying Bitcoin is staked through Babylon’s protocol, where it provides economic security to Proof-of-Stake networks called Bitcoin Secured Networks. Those networks pay for Bitcoin’s security, and those rewards — converted to BTC — flow back to LBTC holders. This is native Bitcoin yield: not from lending, not from liquidity mining, but from Bitcoin actively securing other networks.

Advantages of the Lombard Ecosystem

Unmatched Liquidity 

LBTC gives you the best of both worlds: your Bitcoin earns yield while remaining fully liquid. With 75%+ asset utilization and $750M+ deployed through vault strategies, LBTC is the most actively used yield-bearing Bitcoin asset in DeFi — tradeable, usable as collateral, and deployable across 100+ protocols on 15+ chains.

Institutional-Grade Security 

Lombard’s Security Consortium comprises 11 of the most respected institutions in digital assets — OKX, Galaxy, DCG, Wintermute, Kraken, Figment, Antpool, F2Pool, Amber Group, P2P, and Kiln — providing decentralized, multi-layered validation of every transaction. Cross-chain infrastructure is secured by Chainlink CCIP. The result: 100% uptime and zero security incidents since day one.

Market-Proven Adoption 

Lombard holds 50%+ market share among yield-bearing Bitcoin tokens and reached $1 billion TVL in just 92 days — faster than stETH, faster than eETH, faster than any yield-bearing token before it. Over $3 billion in previously idle BTC has been activated through the protocol, across 270,000+ holders worldwide.

Diversified Use Cases 

LBTC isn’t just a yield token — it’s productive capital. Use it as collateral to borrow stablecoins, deploy it into automated vault strategies, or access liquidity across leading protocols including Aave, Morpho, Pendle, Spark, and EigenLayer. Lombard turns Bitcoin from a passive store of value into a versatile financial tool that works as hard as you do.

Risks to Consider

While the Lombard ecosystem is highly optimized, all DeFi participation carries inherent risks.

Smart Contract Vulnerabilities and Platform Risk

When you use a DeFi platform, you are relying on a smart contract to execute as advertised. While this is the case more often than not, especially on major platforms, there’s always the chance that the smart contract could have bugs or vulnerabilities. These can either leave the contract subject to bad actors stealing the funds controlled by the smart contract or leave investors unable to retrieve their funds.

Similarly, you are also trusting that the platform itself is both secure and trustworthy, which can introduce counterparty risk. While truly decentralized platforms are subject to code audits which can mitigate malice or incompetence, there is still the chance that the platform could fail in some way, putting your funds at risk.

Complexity

Methods of earning yield can be highly complicated, even for experienced crypto users. The harder a system or platform is for a user to understand, the less likely they will be able to take advantage of any offered benefits.

Fees

It’s important to know what fees a platform may deduct from your potential rewards, as this can greatly impact the value proposition of seeking out BTC yield as compared to simply buying and holding.

How to Earn BTC Yield with Ledger and Lombard

Ledger Wallet empowers users to unlock the full potential of their Bitcoin holdings by offering secure access to yield opportunities, enabling exploration of innovative DeFi use cases, and pioneering BTC yield generation with unmatched security.

You can access these opportunities directly through the Lombard via Figment app integrated in the Discover tab of Ledger Wallet. To get started, you will need the latest versions of Ledger Wallet, the Bitcoin and Ethereum apps, and hold at least 0.0002 BTC.

To begin this process, you simply generate a secure Bitcoin deposit address by signing a message on your Ledger signer. Once the address is set up, it connects directly to your Bitcoin and Ethereum accounts, and you can deposit BTC directly through the Earn tab. In exchange, you receive LBTC in your Ethereum account.

Withdrawals are just as straightforward, allowing you to convert your LBTC back to BTC via the Figment dashboard, with funds appearing in your account typically within 72 hours.

For a complete, step-by-step technical walkthrough, you can refer to the official Ledger Help Center guide.

Ledger Wallet^TM: Secure Digital Ownership While You Earn

This integration allows you to participate in pioneering BTC yield generation via Figment and Lombard without ever surrendering control of your assets. As the all-in-one crypto app Ledger Wallet is the best way to experience the world of crypto while enjoying the peace of mind that comes from the security of a Ledger Signer.

Download Ledger Wallet today to explore the Earn/Yield section and turn your Bitcoin into a productive asset while enjoying the secure digital ownership that Ledger provides.