Crypto exchange Kraken on Wednesday launched BTC Vaults, a Bitcoin yield product inside its Krak app that pays up to 2.5% variable APY in BTC.
The product is available to users in the US (excluding New York and Maine), the EEA and Canada. There is no minimum deposit. Withdrawals carry a 5-day wait period.
Users deposit BTC into a Vault, rewards auto-compound in Bitcoin, and the position stays fully exposed to BTC price moves. Kraken describes it as yield without changing the holder’s exposure.
A Kraken support article explains the mechanics: deposited BTC is wrapped to kBTC and sent to a non-custodial embedded wallet on the Ink network, then deposited into a Veda vault managed by risk manager Sentora. The kBTC is supplied as collateral to a lending protocol, stablecoins are borrowed against it, and those stablecoins are deployed into DeFi strategies. Rewards are converted back to kBTC and re-deployed.
Kraken said the APY is variable and not guaranteed, and that onchain interactions involve technological, market and operational risks. Vaults are provided by Payward Wallet, LLC.
BTC Vaults add to an existing product line. Kraken had already offered USDC Vaults on the same infrastructure, which the company said held more than $180 million across 38,000 users before the BTC launch.
