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"Restaking" is all the rage in Ethereum blockchain circles. It allows users to earn interest by leveraging their staked assets to help secure other blockchain apps. Even developers on other ecosystems, like Solana, are trying to replicate Ethereum's restaking popularity.

So it was only a matter of time before restaking made its way to the most valuable blockchain: Bitcoin.

In partnership with Bitcoin staking protocol Babylon, the startup Lombard has raised $16 million to build out Bitcoin-based restaking. In addition to capitalizing on the restaking hype, Lombard is the latest startup to integrate Bitcoin into the wider world of decentralized finance (DeFi) – an industry that so far has mostly been lacking on Bitcoin.

"Lombard aims to elevate BTC from a store of value into a productive asset which flows into the Web3 economy and drives sustainable growth," the company said in a statement shared with CoinDesk.

Polychain Capital led Lombard's funding round, joined by BabylonChain, Inc., dao5, Franklin Templeton, Foresight Ventures, Mirana Ventures, Mantle EcoFund and Nomad Capital.

Restaking was introduced on Ethereum with EigenLayer, one of the biggest DeFi success stories in recent memory. EigenLayer rocketed to $18 billion in deposits in under a year by promising users extra interest on assets they'd already "staked" to help secure Ethereum.

EigenLayer's "restaked" assets get pooled together to secure a web of other crypto protocols that use proof-of-stake security . In essence, EigenLayer and other restaking protocols let upstart blockchain apps bootstrap their security, and they offer investors a new way to leverage their crypto holdings.

Read more: Restaking 101: What Are Restaking, Liquid Restaking and EigenLayer?

Bitcoin restaking

Lombard's dive into restaking will be built on top of Babylon, which lets people use bitcoin to secure other proof-of-stake networks . Paradigm previously led a $70 million funding round into the Bitcoin staking company.

Lombard extends on Babylon's cross-network security tech with the advent of "liquid bitcoin" tokens, or LBTC – a kind of tradeable receipt on Babylon deposits that will, according to Lombard, allow users to retain liquidity over the BTC that they've staked to secure other networks.

"By uniting major ecosystems and DeFi protocols to onboard LBTC, over $1.3 trillion in Bitcoin can be used to lend, borrow and trade, providing new capital opportunities for bitcoin holders, and new capital and users for the ecosystems and their protocols," Lombard said in a statement shared with CoinDesk.

Ethereum's ETH token started out as the staked asset du jour on EigenLayer. ETH (and ETH derivatives) were considered less likely than most other digital assets to drop suddenly in price – which can harm the security of proof-of-stake networks.

Many of the same attributes that make Ethereum an obvious candidate for restaking also extend to Bitcoin, the oldest blockchain. Bitcoin boasts the largest market value in blockchain—1 BTC was worth $63,000 at press time—and it tends to be less volatile than other crypto assets.

"Our commitment to Lombard represents a deeper belief in the leverage Bitcoin can have in catalyzing growth across the whole blockchain space,” Olaf Carlson-Wee, the founder of Polychain Capital, said in a statement.