Coinbase Launches Wrapped Bitcoin on Ethereum and Base

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Coinbase has launched a new Wrapped Bitcoin called Coinbase Wrapped BTC (cbBTC), an ERC20 token backed 1:1 by Bitcoin held in Coinbase custody, the company announced today. At launch, cbBTC will be supported on Base and Ethereum, with plans to expand to more chains.

According to Coinbase, the move aims to increase the utility and economic freedom for Bitcoin by allowing Coinbase customers to seamlessly access DeFi applications in the Ethereum ecosystem using their existing Bitcoin holdings.

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

By connecting deep Bitcoin liquidity off-chain to high-speed and 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 engage in new DeFi use cases, such as providing Bitcoin as liquidity for DeFi protocols or using it as collateral to lend other crypto assets. Many popular DeFi apps, including Aerodrome, Curve, Aave, Morpho, and Compound, among others, will accept cbBTC on day one.

How Coinbase Wrapped BTC Works

As mentioned, 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 in their Coinbase account, it will automatically be converted to BTC at a 1:1 ratio.

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

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