Flow Traders pilots Lombard Finance’s Bitcoin onchain credit strategy

Flow Traders is an early institutional participant in Lombard Finance’s Bitcoin Onchain Credit Strategy, a structure that lets the market maker borrow stablecoins while Bitcoin Earn depositors provide collateral coverage through Cap’s automated credit marketplace on Ethereum. Borrowing premiums paid by Flow Traders are passed through to depositors, adding a source of yield tied to institutional credit demand rather than solely to DeFi market conditions. The setup separates the borrower from the collateral provider. Bitcoin holders deposit assets into Lombard’s managed Bitcoin Earn vault, while Cap tracks the loan and collateral levels and can liquidate or slash delegated assets if coverage falls below required thresholds. Symbiotic provides the shared-security layer, and each approved operator receives isolated collateral coverage rather than drawing from a common pool. Bitcoin Earn, launched in February 2026, functions as a managed meta-vault where users can deposit LBTC, BTC.b, WBTC or native Bitcoin and receive BTCe receipt tokens. Lombard said the product has recorded more than $1 billion in deposits from over 38,500 users. The initial vault is managed by Sentora, with infrastructure from Veda. Lombard is also using Chainlink’s Cross-Chain Interoperability Protocol, or CCIP, to move BTC.b from Avalanche into the Ethereum vault used by the strategy, extending cross-chain access to the credit product. The route builds on Lombard’s May move to standardize transfers for more than $1 billion in LBTC and BTC.b assets using CCIP, replacing LayerZero across several networks, and follows Lombard’s October 2025 acquisition of BTC.b and its infrastructure from Ava Labs. The pilot broadens Lombard’s Bitcoin products beyond staking and standard DeFi lending, but it leaves meaningful risks in place. Lombard says BTCe withdrawals can take up to 14 days and settle in LBTC regardless of the original deposit asset, while Cap warns that malicious or undercollateralized operators could expose delegated assets to slashing or liquidation. Lombard has not disclosed the pilot loan’s size, duration, stablecoin type or interest rate.