1.5 Fees and Economics.

BTC.b Fee Structure:

Fee Type	Rate
Minting Fee	0% (Only network gas fee)
Redemption Fee	0.1%
Transfer Fee	0% (Only network gas fee)
Management Fee	0%
Custody Fee	0%
Performance Fee	0%

Understanding BTC.b's Fee Structure

BTC.b operates with one of the most straightforward and economical fee structures in DeFi. The protocol's design philosophy prioritizes accessibility and efficiency, ensuring that fees never become a barrier to participation or erode the value of holdings over time. Unlike many wrapped Bitcoin assets that layer multiple fees throughout the user journey, BTC.b maintains a simple, transparent fee model that users can easily understand and predict.

The absence of protocol fees for most operations distinguishes BTC.b from traditional financial products and even many DeFi alternatives. There are no management fees deducted from holdings, no performance fees on any gains, and no custody charges for maintaining your BTC.b balance. This means that one BTC.b held for a year remains exactly one BTC.b, with no erosion from ongoing charges that traditional financial products often impose.

Minting and Redemption Fees

Minting BTC.b from native Bitcoin incurs no protocol fee beyond the network transaction costs. Users pay only the Bitcoin network fees to send their BTC to the deposit address, and gas fees on the destination chain to receive their BTC.b. The protocol does not extract any additional value during the minting process, ensuring that users receive BTC.b equivalent to their Bitcoin deposit minus only the unavoidable network costs.

Redemption carries a minimal fee of 0.1% to cover the operational costs of maintaining the security infrastructure and Bitcoin network fees for the withdrawal. This fee is substantially lower than most competing products, which often charge 0.25% to 0.5% or more for similar operations. The redemption fee is calculated on the amount being redeemed and clearly displayed before confirmation, ensuring complete transparency.

For institutional users or high-volume traders, volume-based fee tiers may be available through direct partnership agreements. These arrangements recognize the value that large users bring to the ecosystem through liquidity provision and help make BTC.b competitive with traditional custody solutions. Contact the Lombard team directly to discuss institutional pricing structures.

Hidden Costs in Comparable Products

When evaluating BTC.b's fee structure, it's important to consider the hidden costs often present in alternative Bitcoin products. Centralized wrapped Bitcoin products frequently include spreads between minting and redemption prices, creating an implicit fee that may not be immediately apparent. Some products charge ongoing custody fees that continuously erode holdings. Others require minimum balances or charge inactivity fees that penalize smaller or less active users.

Many comparable products also impose operational friction that creates indirect costs. KYC requirements may delay access to funds during critical market movements. Geographic restrictions may force users into less efficient alternatives. Custody arrangements may limit when and how users can access their Bitcoin. BTC.b eliminates these hidden costs and restrictions, providing true ownership without compromise.

The opportunity cost of locked or delayed funds represents another often-overlooked expense. Products with long redemption delays or unstaking periods prevent users from responding to market opportunities or liquidity needs. BTC.b's relatively quick redemption process and instant transferability ensure that users maintain control and flexibility, reducing opportunity costs.