How Does Stroom Work?
Stroom was a liquid staking protocol for Bitcoin on the Lightning Network. Its TVL collapsed from $14.6M to under $25K between March 5-26, 2026 with no public announcement. The protocol appears to have quietly wound down. Avoid depositing or holding lnBTC or stBTC tokens until the team makes an official statement.
TVL
$24,000
Sector
Liquid Staking
Risk Grade
C
Value Grade
D
Core Mechanisms
3.4.2
NovellnBTC/stBTC reward-bearing token on Ethereum representing BTC staked on Lightning Network; appreciates via routing fee accrual
Novel: LST backed by Lightning Network routing fees rather than PoS validator rewards
8.1.1
NovelFederated bridge between Bitcoin/Lightning Network and Ethereum for lnBTC minting; BTC locked on Lightning, lnBTC minted on Ethereum
Novel cross-domain bridge spanning Bitcoin L1, Lightning L2, and Ethereum
2.2.1
Lightning Network routing fees distributed to stakers via exchange rate appreciation of stBTC token
Revenue from routing fees flows to token holders through standard LST appreciation mechanism
5.1.1
Stroom DAO governance with STROOM token for protocol parameter and strategy decisions
Standard token-weighted governance
8.3.1
Restaking as economic security layer for the bridge; restaked assets serve as insurance collateral against bridge attacks
Leverages restaking pools to provide economic guarantees for bridge security
3.2.1
Slashing of restaked collateral in case of bridge misbehavior; slashed funds used as recovery reserves
Slashing mechanism tied to bridge security rather than validator performance
How the Pieces Interact
Bridge compromise could allow minting of unbacked lnBTC on Ethereum while BTC on Lightning is stolen
Variable Lightning routing fee income makes the LST yield unreliable; low routing demand could make stBTC unattractive
If restaked collateral value drops below BTC locked in bridge, economic security guarantee fails and bridge attacks become profitable
Governance control over bridge operator set creates risk of governance attack leading to malicious operator changes
Slashing events on bridge insurance layer could trigger cascading withdrawals from restaking pools, reducing security when most needed
What Could Go Wrong
- Protocol TVL collapsed from $14.6M to under $25K in March 2026 with no public announcement — protocol appears functionally dead
- BTC locked in federated bridge with no trustless withdrawal path — bridge operators control all user funds
- No official communication from team on protocol status — depositors face significant uncertainty about fund recovery
Federated Bridge Compromise and lnBTC Depeg
ModerateTrigger: Federated bridge operators are compromised through key theft, collusion, or social engineering
- 1.Bridge operator keys compromised or operators collude — Attacker drains BTC from Lightning channels or mints unbacked lnBTC
- 2.lnBTC discovered to be undercollateralized — Market sells lnBTC aggressively, price drops below BTC peg
- 3.DeFi protocols using lnBTC as collateral trigger liquidations — Cascading liquidations across Ethereum DeFi for lnBTC positions
- 4.Restaking insurance layer activated — Slashed funds may be insufficient; partial recovery at best
- 5.Protocol reputation destroyed — Remaining users exit; TVL drops to near zero permanently
Risk Profile at a Glance
Overall: C (44/100)
Lower score = safer