Coinbase Unveils 1:1 Bitcoin-Backed Token, cbBTC, on Ethereum Blockchain

Coinbase, a leading cryptocurrency exchange platform based in the United States, has introduced Coinbase Wrapped Bitcoin (cbBTC), a token backed by Bitcoin (BTC) on the Ethereum (ETH) blockchain.

The announcement of cbBTC’s launch was made by Coinbase on the social media platform X, indicating that cbBTC is now live on the blockchain, enabling holders of the top cryptocurrency, Bitcoin, to engage with decentralized finance (DeFi) applications on both the Base and Ethereum networks.

According to Coinbase, cbBTC will be supported on various prominent DeFi platforms, including Aave (AAVE), Curve Finance (CRV), Compound Finance (COMP), Moonwell (WELL), and Maple Finance (MPL).

In a recent blog post, Coinbase detailed how users holding BTC can leverage the Coinbase-wrapped version of Bitcoin to enhance their DeFi interactions. The post highlighted that cbBTC facilitates the utilization of existing Bitcoin holdings in new ways within the DeFi ecosystem, offering seamless compatibility with DeFi applications. Users can explore innovative DeFi opportunities such as providing Bitcoin as liquidity to DeFi protocols or utilizing it as collateral to borrow other cryptocurrencies.

Transactions involving BTC on Coinbase that are sent to addresses on the Base or Ethereum blockchains will automatically be converted 1:1 to cbBTC. Similarly, when users receive cbBTC in their Coinbase accounts, it will be converted back to BTC at a 1:1 ratio.

At the time of writing, Bitcoin is trading at $57,688, reflecting a 2% increase over the past 24 hours.

It is important to note that the opinions expressed in this article are not intended as investment advice. Investors are advised to conduct thorough research before engaging in high-risk investments involving Bitcoin, cryptocurrencies, or digital assets. All transfers and trades are undertaken at the individual’s own risk, and any resulting losses are the responsibility of the investor. The Daily Hodl does not advocate for the buying or selling of cryptocurrencies or digital assets and is not a registered investment advisor. Additionally, The Daily Hodl engages in affiliate marketing activities.

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