Coinbase Introduces Wrapped Bitcoin on Ethereum and Base

Key points

Coinbase’s cbBTC enables millions of customers to access DeFi applications using their bitcoin holdings.
cbBTC is backed 1:1 by bitcoin held in custody by Coinbase, fostering trust and liquidity in the DeFi ecosystem.

Coinbase has launched a new wrapped bitcoin called Coinbase Wrapped btc (cbBTC), an ERC20 token backed 1:1 by bitcoin held in custody at Coinbase, as btc-cbbtc-is-now-live” target=”_blank” rel=”nofollow noopener noreferrer”>announced The company announced today that cbBTC will launch on Base and ethereum, with plans to expand to more chains.

According to Coinbase, the move aims to increase the utility and economic freedom of bitcoin by allowing Coinbase customers to seamlessly access DeFi applications within the ethereum ecosystem using their existing bitcoin holdings.

The company said its cbBTC is designed to be a trusted and reputable wrapped version of bitcoin, leveraging Coinbase’s secure custody of billions of btc for institutions and customers around the world.

By bridging bitcoin’s deep off-chain liquidity with high-speed, low-cost financial rails on Base and ethereum, cbBTC helps build a more efficient, interconnected and expansive financial ecosystem, Coinbase noted.

With Coinbase Wrapped btc, users can participate in new DeFi use cases, such as providing bitcoin as liquidity to DeFi protocols or using it as collateral to borrow other crypto assets. Numerous popular DeFi applications, including Aerodrome, Curve, Aave, Morpho, and Compound, among others, will support cbBTC on day one.

How Coinbase Wrapped btc Works

As noted, when a Coinbase user sends their btc to a Base or ethereum address, their btc is automatically converted to cbBTC at a 1:1 ratio. Similarly, if a user receives cbBTC into their Coinbase account, it will be automatically converted to btc at a 1:1 ratio.

Initially, cbBTC sending and receiving features are available on Coinbase in the US (excluding New York State), UK, EEA states, Singapore, Australia, and Brazil.