Kraken Offers Bitcoin Holders a Way to Earn Yield Without Leaving the Exchange

TLDR

• Kraken launched a new Bitcoin Vault product offering holders up to 2.5% annual yield on their BTC
• The product is powered by DeFi infrastructure provider Veda and routes deposits into lending protocols like Aave, Morpho, and Tydro
• Within 10 hours of launch, the vault attracted $30 million in deposits from 4,000 unique wallets
• The product is non-custodial, meaning only depositors can access their funds, with withdrawals taking around five days
• Kraken’s earlier stablecoin vault products have already pulled in over $245 million in deposits since January

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Crypto exchange Kraken has launched a new product that lets Bitcoin holders earn a 2.5% annual yield on their holdings without having to leave the platform or interact directly with decentralized finance protocols.

LATEST: ⚡ Kraken launched Bitcoin Vault, letting BTC holders earn up to 2.5% APY through DeFi strategies. pic.twitter.com/sYrxceHmTD

— CoinMarketCap (@CoinMarketCap) May 27, 2026

The product, called Bitcoin Vault, is part of Kraken’s Earn product lineup. It is built in partnership with crypto yield infrastructure company Veda.

The launch comes as demand from Bitcoin holders for yield products has grown. Unlike Ethereum or Solana, Bitcoin does not have a built-in way for holders to earn rewards on their coins.

How the Bitcoin Vault Works

When users deposit Bitcoin into the vault, it is converted into Kraken Wrapped Bitcoin, or kBTC. This is a token that tracks Bitcoin’s price.

The kBTC is then deployed by Sentora, a crypto platform, across DeFi lending protocols including Aave, Morpho, and Tydro. Borrowers on those platforms pay interest, which flows back to depositors as yield.

Kraken says the product is non-custodial. That means only the depositor can move or withdraw their funds.

Withdrawals are estimated to take five days to process. Service providers take a 25% performance fee on any rewards earned.

Veda said the product passed $30 million in Bitcoin deposits from 4,000 unique wallets within the first 10 hours of going live.

Kraken’s Broader Yield Push

Kraken Director of Product John Zettler said the vault was built for Bitcoin holders who want to earn on coins they already plan to hold long-term.

The Bitcoin Vault is part of a larger push by Kraken to offer simpler versions of DeFi yield strategies to its users. The exchange launched a DeFi Earn initiative earlier this year that includes staking, an Auto Earn feature, and several vault products.

Kraken rolled out three stablecoin yield products in January. Those products have since attracted around $245 million in combined deposits and generated over $2.2 million in yield for users.

The USDC Vaults product alone has seen nearly $250 million in deposits through what Kraken describes as organic growth, without paid incentives.

Bitcoin Vault builds on that momentum by extending the same model to BTC, which has historically offered fewer options for generating passive income compared to other major cryptocurrencies.

Veda, the infrastructure partner, said the product aims to remove the complexity of wrapping Bitcoin, moving assets between platforms, or managing a crypto wallet.

The product is now live on Kraken for eligible users.