WRAPPED BITCOIN (WBTC)

Obviously, over 10 years since Bitcoin was created, the technology behind the revolutionary “peer-to-peer electronic cash system” has significantly remained the same.  

Nevertheless, innovations have been happening in other parts of the blockchain ecosystem with fast-growing Decentralised Finance (DeFi) as a salient example.  

Therefore,based on these conditions and great chances, WBTC tries to combine the best of both worlds by creating the value and liquidity of Bitcoin and making it usable in the DeFi world. 

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1.What is Wrapped Bitcoin?

  • Firstly, WBTC stands for Wrapped Bitcoin and is simply an ERC20 token representing Bitcoin. One WBTC equals one BTC
  • Secondly, WBTC is an Ethereum token designed to bring increased liquidity to DeFi apps
  • Also, BTC holders can lend their Bitcoin in the form of WBTC and earn interest 
  • WBTC is supervised by a group of organizations working under the DeFi banner to help provide more complicated financial services 
  • Moreover, with the rise in popularity of ERC20, digital tokens in the Ethereum ecosystem have emerged as an important asset class. Therefore, these tokens have all the advantages that blockchains and Ethereum have to offer in terms of transparency in total number of coins, owners, minting, fast confirmation times, transactions details and smart contract execution. Tokens on the Ethereum blockchain can serve several different functions; this paper will specifically focus on asset backed or wrapped tokens. The prices of these tokens reflect the price of the asset backing them and hence they can also be called “stable coins”. Asset backed tokens are usually done in two different ways: 
  • ● Firstly, Algorithmic – This is a mechanism followed by some tokens on Ethereum where demand and supply are controlled by smart contracts in order to keep the price of the token in line with a fiat currency. Some examples of this are Dai, Basis, Carbon, and NuBits 
  • ● Secondly, Centralized – Assets are stored with an organization which publishes proof of reserves. This is the case with Tether, True USD, USDC (USD), Digix (gold), Globcoin (a mix of fiat currencies), and AAA reserve (governmental bonds) 
  • Wrapped tokens follow the centralized model, but instead of relying entirely on one institution, they rely on a consortium of institutions performing different roles in the network. 
  •  In fact, the first wrapped token launched will be an ERC20 token backed by Bitcoin (BTC) and will be appropriately named, “Wrapped BTC” (WBTC). Unlike centralized solutions (USD), WBTC will be fully accounted for and proof of reserves posted on the BTC chain. There is no additional secondary utility/payment token required to use WBTC, and no transfer fees other than blockchain fees. Since, WBTC uses a simple federated governance model and strives to promote usability.

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2. What are the competitive advantages of WBTC?

  • Being an ERC20 token makes the transfer of WBTC faster than normal Bitcoin 
  • Integration of WBTC into the world of Ethereum wallets, dapps, and smart contracts
  • Besides, WBTC increases trust and transparency by undergoing regular audits and publishing all on-chain transitions and verifications for the Bitcoin and Ethereum networks
  • WBTC maintains several nodes and manages transaction types in order to support multiple currencies 

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3. WTBC Data

[Updated on 23rd June 2020 based on: https://www.coingecko.com/en/coins/hybrix]

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Wrapped Bitcoin Price$9,683.39
Market Cap?
Market Cap Dominance0.00%
Trading Volume$20,238,492
Volume / Market Cap
24h Low / 24h High$9,409.99 / $9,870.83
7d Low / 7d High$9,289.62 / $9,741.95
Market Cap RankN/A
All-Time High$14,024.71 -31.1%Jun 26, 2019 (12 months)
All-Time Low$3,139.17 207.9%Apr 02, 2019 (about 1 year)
Wrapped Bitcoin/Bitcoin Ratio1 BTC = 0.99 WBTC

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4. WBTC Community


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