Based on this:
We facilitate the establishment and deployment of your lightning node.
It sounds like they are running a Voltage-like node hosting service, and like Voltage, don't have direct access to your keys:
Manage your funds through Rails while maintaining custody of your Bitcoin.
The announcement blog elaborates on the extent of their control over funds:
Here's how it works: Amboss handles node operations with strictly limited permissions (receive lightning, open channel, close channel), using AI-driven insights derived from over five years of network data.
Expected APY is 1-4%:
Yields are driven by the market demand for liquidity and payment activity on the Lightning Network. Yields are uncertain. Historical yields from liquidity leases are between 1-4% APY per lease; however, these yields are not guaranteed.
Rails takes a fixed monthly fee of $30 and 0.6% yearly:
Rails is a paid, automated service with the following fees: a platform fee of $30 per month and a variable fee of 0.6% per year based on Assets Under Management (AUM).
KYC/KYB is required (which I think is normal for hosted node services):
You will need to provide valid KYC/KYB documentation and make an initial deposit of 1 BTC or more.
If/when CashApp's 10% APY is generalizable, we can expect more services like this to pop up.