Kraken has launched Bitcoin Vault, a new yield product offering 2.5% annual returns on Bitcoin holdings through decentralized finance lending markets.
The company developed the service with DeFi infrastructure provider Veda as Bitcoin investors increasingly seek passive income opportunities.
Kraken said the vault attracted more than $30 million from 4,000 wallets during its first 10 hours.
The exchange added that users can earn yield while maintaining non-custodial control of their assets.
Bitcoin yield demand pushes Kraken deeper into DeFi
The new product joins Kraken’s growing Earn ecosystem, which already includes staking, Auto Earn, and stablecoin vault offerings.
Investors deposit Bitcoin into the vault, where the assets convert into Kraken Wrapped Bitcoin, or kBTC.
Sentora distributes the kBTC across DeFi lending protocols including Aave, Morpho, and Tydro. Borrowers on those platforms generate interest payments that return to vault participants as yield.
Unlike traditional custodial services, the structure allows users to retain direct ownership of their assets. Withdrawals, however, require around five days to complete.
Service providers connected to the vault also collect a 25% performance fee from generated earnings.
Veda explained that the product removes several technical challenges tied to decentralized finance participation.
Users no longer need to wrap Bitcoin manually, bridge assets across protocols, or manage external crypto wallets.
John Zettler, Kraken’s Director of Product, described the vault as a solution for long-term Bitcoin holders seeking returns on idle assets. He noted that many investors want exposure to DeFi yield strategies without navigating multiple platforms or applications.
Kraken strengthens DeFi Earn ecosystem with Bitcoin Vault
Bitcoin Vault extends Kraken’s broader push into decentralized finance services this year.
Earlier in January, the exchange introduced several stablecoin vault products through its DeFi Earn initiative.
Those stablecoin vaults have already attracted more than $245 million in deposits across Kraken’s platform. The products have surpassed $2.2 million since launch.
Kraken also highlighted the rapid growth of its USDC Vaults offering. Nearly $250 million entered the product through what the exchange described as organic growth without incentives.
The Bitcoin Vault applies the same operational framework to BTC, where passive income products remain less common than in Ethereum or Solana ecosystems.
Bitcoin lacks native staking capabilities, which has increased demand for alternative yield strategies tied to lending markets.
Through the partnership with Veda, Kraken aims to simplify DeFi-based Bitcoin yield products for mainstream exchange users.
The approach focuses on reducing technical barriers while keeping users connected to decentralized lending opportunities.
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