• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Changelly
  • Price table

Crypto News PRO

From the world all news

  • Home
  • News

Ethereum Wrapped Bitcoin Supply Doubles In August Alone, But Why?

Written by:
Aeon Flux
Published on:
1 September 2020
Thoughts:
No comments yet

The decentralized finance movement has helped drive up the value of Ethereum and other ERC-20 based projects compared to Bitcoin and other assets. It has prompted even Bitcoin holders to “wrap” their BTC in Ethereum.

The amount of BTC supply wrapped in Ethereum has doubled in August alone, but why exactly is this happening, and what does it mean for Bitcoin?

Explosive DeFi Trend Teaches Old Dogs New Tricks As Crypto Adapts

The buzz surrounding DeFi has breathed new life into the crypto market, but no assets more than Ethereum any related projects. Ethereum is up over 200% year to date as a result.

The DeFi bandwagon has created a thriving sub-industry, where crypto insiders speculate on assets they know full well are potentially “worthless” yet are willing to risk capital anyway.

Related Reading | Why DeFi Bulls Being Over 90% Net Long Is Dangerous a For Crypto

So far, these insiders have been making a fortune. Several DeFi projects have risen the ranks of the crypto market top 100, while one such token has now more than tripled the price per BTC currently.

The amount of ETH tokens locked up in DeFi has soared throughout the year. Now, Bitcoin is following a similar path, with the amount of the BTC supply wrapped in Ethereum doubling in August alone according to glassnode data.

But what is the reason for crypto investors moving their Bitcoin to Ethereum, and how does this benefit the holder over traditional BTC?

etheruem wrapped bitcoin wbtc

etheruem wrapped bitcoin wbtc

Why Ethereum Wrapped Bitcoin (WBTC) Supply Has Doubled Over The Last Month

As the first-ever cryptocurrency, it was designed to be a peer-to-peer electronic replacement for cash. The altcoins that came after its creation, have a lot more tricks up their sleeve. Ethereum’s smart contracts allow it to do a lot more than Bitcoin can.

Ethereum can also lend some of its abilities to Bitcoin, by “wrapping” each BTC.

Each WBTC is an ERC-20 smart contract tied 1:1 to a corresponding BTC asset. As for why anyone would do such a thing, wrapping BTC this way bestows it some of the attributes of an ERC-20 token.

Related Reading | Buy Crypto: Search Term Spikes To Highest Point Since Bubble

For example, it allows Bitcoin to be lent out in DeFi apps or to be traded on decentralized cryptocurrency exchanges.

Bitcoin is arguably the biggest and therefore the best cryptocurrency. But by wrapping it in Ethereum, it makes a good thing even better and teaches this old dog a few new tricks.

The ability to wrap BTC has been around for some time, but the recent DeFi lending buzz and explosion of Uniswap has made wrapping BTC far more attractive. It also has the side effect of making the leading cryptocurrency by market cap far more versatile.

Could the ultimate cryptocurrency be WBTC? Rapidly rising supply at least says it has growing merit and could become even more attractive in the future.

Tags: bitcoinbtcbtcusdBTCUSDTERC-20ethbtcethereumethusdETHUSDTWBTCwrapped bitcoinxbtxbtusd

Categories: Bitcoin, Ethereum, News

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

Search in the news

Translate:

Earn up to 5% every 10 days with Aeon Flux Coins

Categories

  • Bitcoin (2,395)
  • Ethereum (1,612)
  • News (4,986)

Recent Posts

  • Exploring the Foundation of the Fantom Blockchain 30 April 2022
  • Interview with Oleg Kotliarov, CEO at Attarius Network 29 April 2022
  • Ragdoll Cat NFT Marketplace is Coming Soon with a New Token 29 April 2022
  • MRHB.Network’s SouqNFT Marketplace Hosts World’s First NFT-based Halal Certifications 29 April 2022
  • The Magnet of Play-to-Earn, And What Could Sink It 29 April 2022

Archives

  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020

© 2015-2020 Crypto News PRO
All Rights Reserved. Powered by IWG Agenzia Web