Coinbase Launches Wrapped Bitcoin (cbBTC) on Base and Ethereum

The leading US-based cryptocurrency trading platform has announced the launch of its Wrapped Bitcoin product (cbBTC) on two blockchains: Base and Ethereum.

This release follows months after the implementation of the Lightning Network for BTC transactions.

In a statement, the exchange revealed that the Wrapped Bitcoin (cbBTC) will be “backed 1:1 by Bitcoin (BTC) held by Coinbase.”

Currently, this new offering is available only on Base and Ethereum, with plans for future expansion to additional networks; however, no specific blockchains were mentioned in the announcement.

“With cbBTC, we are enhancing economic freedom by giving users more avenues to utilize their Bitcoin. Starting today, millions of Coinbase users can easily and securely access financial applications within the Ethereum ecosystem using their existing Bitcoin.” – this statement highlights Coinbase’s earlier integration of the Lightning Network for quicker and more affordable BTC transfers.

The new product is designed to facilitate multiple DeFi applications due to its compatibility with the sector. BTC holders will be able to “explore exciting DeFi use cases,” including providing liquidity to DeFi protocols or “using it as collateral for borrowing other crypto assets.”

Some DeFi projects that will support cbBTC from the start include Curve, Aave, Compound, Mellow, DeFinitive, Steakhouse, and Maple.

cbBTC will not feature a separate order book or trading pair on Coinbase. When users transfer their BTC from the exchange to the specified Base and Ethereum addresses, the funds will be automatically exchanged 1:1 for cbBTC and vice versa.

Exchange customers will have the ability to trade cbBTC on decentralized exchanges (DEXs) using Coinbase Wallet and other third-party trading platforms that support it.

For now, cbBTC is available to Coinbase users located in the US (excluding New York State), the UK, EEA countries, Singapore, Australia, and Brazil.