A new tool allows you to obtain passive yields with Bitcoin (BTC). These are Rails, a service presented on May 29 at the Bitcoin Conference 2025, held in Las Vegas.
That launchdriven by both, a company focused on technological solutions for Bitcoin and its second -layer (L2) lightning network (LN), promises users to get income with their BTC while while add the liquidity to the LN.
As Cryptonotics reported recently, taking out performance from Lightning nodes is something new, but there would be several solutions and ways to do so. The developer Miles Suter reported in that same event that through an “C =” routing node operated in that L2, configured and managed by the Block company, could also access passive returns in BTC. In that case, the annual percentage was surprising since it reached almost 10% per yearsurpassing banks and other financial tools.
Why does liquidity in Lightning Network matter?
In the LN Transactions are made outside the main layerregistering only the final result in the base layer, getting shorter transaction times and cheaper commissions than the Bitcoin base layer, but usphruting its safety.
In that system, users They open payment channels with each otherdepositing bitcoin in a kind of “safe” shared between the parties. Then, they can make multiple transactions between them without the need to register each one in the main chain, which reduces costs and accelerates the times.
In this system, Users open payment channels with each otherdepositing BTC in a special direction in Bitcoin. This address, known as multifirma, works as a safe agreement that requires the consent of both parties to move the funds.
It is as if they placed their bitcoins in a shared account that can only be opened with the ‘keys’ of both, guaranteeing that no one can access money without mutual agreement. Once the channel is open, transactions are made outside the main network, directly among users, which makes them faster and more economical.
However, for these transactions to be effective, the LN needs liquidity, that is, funds enough in the channels to facilitate payments. If a channel does not have enough bitcoin available, the transactions can fail.
This is where Rails enters, a service designed to encourage users to provide that necessary liquiditywhile obtaining a potential performance in return.
How does Rails work and how do you generate yields?
Both are managed the operations of the nodes in the Lightning Network with “strictly limited permits, which include receiving payments, opening and closing channels”, using processed information by artificial intelligence (AI), as detailed by the announcement. RAILS, meanwhile, is the tool created by that company that allows users to become liquidity suppliers (LPS), that is, people or companies that provide bitcoin to lightning network to facilitate transactions.
Unlike other services that generate yields through loans in decentralized finances (DEFI), or even in traditional (tradfi), Rails does not imply give up the funds. This is known as a model of their own custody, which means that users maintain their bitcoins in nodes that they control themselveswithout risks that a third party manages or losing them.
The yields are generated in two main ways: the routing of payments and the lease of liquidity.
Payment routing occurs when the user’s node helps connect two parts that wish to make a transaction In the lightning network. For example, if “A” wants to send Bitcoin to “B”, but they don’t have a direct channel, Rails user node can act as an intermediarycharging a rate for facilitating payment.
For that case, both indicates that the performance obtained will be the one that “historically” has granted this process: Between 0% and 1% annualdepending on the activity of the network.
On the other hand, liquidity lease implies that the user “Provides” your bitcoins to other nodes to open new payment channels. This method promises a higher performance than the previous option, since both have shown historical yields between 1% and 4% annual.
However, it is important to note that these yields They are not guaranteedsince they depend on the demand for liquidity and the volume of transactions in the lightning network.
Some limitations for the use of Rails
Rails is designed for a diverse audience, but with certain requirements. The service is aimed at companies with treasury in Bitcoin, custodians that manage large amounts of this cryptoactive, individuals of high heritage and individual users who have at least 1 BTC (approximately 105,000 dollars at the current price). This threshold ensures that participants have enough capital to contribute significantly to the network.
However, the service is not exempt from costs or limitations. Both are a monthly rate of 30 dollars, plus 0.6% per year based on assets under management (AUM), that is, on The total value of the bitcoin deposited. In addition, due to the nature of the Network Lightning channels, the funds may be subject to blocking periods, usually about two weeks, although in exceptional cases they could extend depending on the network conditions.
In this sense, a person under the pseudonym ofEzy showed a Posture marked by skepticism. In response to the publication of both in X, he criticized the rates ($ 30/month + 0.6% AUM) and the expected yields (1-4% APy), qualifying it as “difficult to sell.” Both responded, emphasizing that Rails points to low risk returns, not to high performance products, generally risky.
In such a way, users should consider that the yields, which have historically oscillated between 1% and 4% annual according to both, They are not fixed and depend on external factors as the volume of network transactions.
