Lombard Builds LBTC's Institutional Structure on Anchorage Digital

TL;DR: Anchorage Digital provides qualified custody, tri-party agreements, and institutional options execution for Lombard's new LBTC structure.

Bitcoin is the largest asset in crypto and yet still one of the least productive. Most of it sits idle, held rather than deployed, while the collateral markets that would put it to work have been built around everything else. Lombard today announced that the strategy underlying LBTC is transitioning to a managed institutional covered-call options strategy. Anchorage Digital Bank N.A. serves as qualified custodian for the Bitcoin backing the strategy, and Anchorage Digital is among the institutional desks where the strategy's options are traded and financially settled.

The Bitcoin is held in Lombard-owned, segregated, bankruptcy-remote accounts at Anchorage Digital Bank, governed by tri-party agreements. Lombard retains title at all times. The strategy manager holds trading authority only and cannot withdraw, transfer, or rehypothecate the Bitcoin under any circumstances. No party can unilaterally move or encumber the Bitcoin. Release from the tri-party structure requires authorization from Lombard, the strategy manager, and Anchorage Digital Bank. Bitcoin does not leave custody as a result of the strategy's activity.

That structure is a differentiator at scale. An institutional Bitcoin strategy at this scale requires more than a wallet, it requires clear title, legal segregation, defined authorities, and a custodian whose obligations are enforceable.

‍The custody standard behind LBTC

Anchorage Digital Bank is the first federally chartered digital asset bank in the U.S., operating under the supervision of the Office of the Comptroller of the Currency. For products where a third party holds trading authority over the underlying assets, federal oversight is what makes the custody arrangement legible to counterparties, auditors, and risk committees.

Segregated, bankruptcy-remote accounts let a manager trade against an asset without ever holding it directly. They're also why LBTC holders can trust that the backing is exactly where it's represented to be.

"Bitcoin's next phase is as collateral, not just as a store of value. What has been missing is infrastructure that meets an institutional standard: segregated custody, clear title, no rehypothecation. Anchorage Digital built a federally chartered crypto bank for exactly this. LBTC's new structure draws on a qualified custodian, tri-party agreements, and derivatives execution in one place, which is what it takes to build an institutional Bitcoin product at this scale."—Nathan McCauley, CEO and Co-Founder, Anchorage Digital

‍Built across Anchorage Digital’s integrated platform 

LBTC's new structure does not rest on custody alone. It draws on a set of capabilities that Anchorage Digital operates as a single, integrated platform:

• A qualified custodian at a federally chartered bank, with segregated, bankruptcy-remote account structures.
• Tri-party agreements that define exactly what the asset owner, the strategy manager, and the custodian can and cannot do. The legal architecture that allows trading authority to be separated from asset control.
• Derivatives execution. Anchorage Digital is among the institutional desks where the strategy's options are executed and financially settled, with no direct posting of collateral required from Lombard.

Each of these exists at other firms in isolation. What is unique is having them available together, from one federally chartered counterparty, under one set of agreements. Lombard’s LBTC is the first bitcoin asset to adopt an institutional offchain strategy with full DeFi composibility, supported by a robust custody and trading infrastructure and asset manager.

"The end-state for the world’s hardest money is superfluid collateral, not stashed away in cold storage. Lombard was built on the conviction that Bitcoin will become one of the dominant collateral assets in DeFi, and LBTC is the clearest expression of that conviction yet: an onchain asset with real income, denominated in Bitcoin, generated by one of the most credentialed asset managers in the world. This is how we get to a trillion dollars of Bitcoin onchain." —Jacob Phillips, CEO and Co-Founder, Lombard Labs

‍The future of institutional Bitcoin

Bitcoin has spent most of its history as an asset to hold. The shift underway is toward Bitcoin as collateral: deployed, borrowed against, and used productively across onchain markets.

Products like LBTC become possible when the custody layer is a regulated bank, when authorities between parties are documented rather than assumed, and when execution and settlement can be arranged alongside custody instead of stitched together across venues.

LBTC’s transition is a demonstration of what Anchorage Digital's integrated capabilities make possible: an institutional Bitcoin product built on one set of agreements, with one counterparty, at a federally regulated bank.

To learn more about building on Anchorage Digital's platform: qualified custody, tri-party structures, and institutional trading get in touch.