Lombard Partners with Bitwise to Activate $500 Billion in Institutional Custody BTC for Yields and Collateralized Lending

SmartContractAuditor · 2026-03-24T18:46:20+00:00

Lombard and Bitwise announced a partnership at the Digital Asset Summit to launch a BTC collateral lending solution that requires no movement out of custody. The solution targets high-net-worth individuals and institutions, with a planned launch in 2026, expected to cover approximately $500 billion in custodied BTC assets. The lending utilizes DeFi technology and Bitcoin native tools to reduce risk.

SmartContractAuditor

2026-03-24 18:46:20

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Odaily Planet Daily reports that Lombard and Bitwise Asset Management announced a partnership at the New York Digital Asset Summit, offering institutional clients a way to earn yields and borrow against BTC without leaving custody, targeting the scale of BTC assets under institutional custody.

Bitwise will develop yield strategies that combine DeFi lending with tokenized real-world assets, while the decentralized lending protocol Morpho will provide infrastructure for BTC collateralized lending.

The platform uses native Bitcoin tools such as partial signature transactions and time locks to verify collateral, allowing positions to be represented on-chain without transferring or re-pledging the underlying assets. Phillips stated that Bitcoin Smart Accounts can simultaneously reduce custody, cross-chain bridge, and counterparty risks.

This solution is aimed at high-net-worth individuals, asset management firms, and corporate treasuries, with plans to launch in Q2 2026 and add more custodians and protocols to expand coverage. Lombard estimates approximately $500 billion worth of BTC is under institutional custody; according to DeFiLlama, BTC’s total value locked in DeFi is about $2.93 billion, with a market cap of roughly $1.4 trillion; as of press time, Babylon Protocol’s total locked value is about $2.8 billion, and Lombard’s is approximately $744 million. (Cointelegraph)

BTC1,94%

MORPHO1,99%

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