What is Wrapped Bitcoin (WBTC) crypto and why is it rising?

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What is Wrapped Bitcoin (WBTC) crypto and why is it rising?

Wrapped Bitcoin (WBTC) crypto
Image source: © Kviztln | Megapixl.com
Highlights:
  • Wrapped Bitcoin is a tokenized version of Bitcoin (BTC), and its runs on the Ethereum blockchain.
  • The price of the WBTC token is pegged to the BTC price in a 1:1 ratio.
  • The token is available on major exchanges like Binance, OKX, etc.

The Wrapped Bitcoin or WBTC crypto has gained traction over the last 7 days. Since the crypto is pegged to Bitcoin, any increment in Bitcoin’s price automatically affects the WBTC price.

The token was up 1.50% to US$41,036.81 at 8:27 am ET on March 17, almost the same as the Bitcoin’s price. The token’s one-day volume fell 30.85% to US$159.20 million at the same time.

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What is Wrapped Bitcoin (WBTC)?

Wrapped Bitcoin is a tokenized version of Bitcoin (BTC), and it runs on the Ethereum blockchain. WBTC is a part of the Wrapped Tokens project founded jointly by BitGo, Ren, and Kyber Network. It was launched in January 2019 after its initial announcement in October 2018.

According to the promoters, the WBTC token meets the basic compatibility standard of the Ethereum blockchain ERC-20, allowing its full integration with Ethereum’s decentralized exchanges and related services such as crypto lending, prediction markets. In addition, it is compliant with other ERC-20-enabled DeFi applications.

The WBTC token price is backed by the BTC price in a 1:1 ratio, maintained via a network of automated monitored merchants and custodians, ensuring that its price is pegged to BTC at all times. The WBTC token enables users to transfer liquidity between Bitcoin (BTC) and Ethereum (ETH) networks in a decentralized and autonomous manner.

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Why is the Wrapped Bitcoin (WBTC) token rising?

The token's price rally follows the recovery in the global crypto market from the Russia-Ukraine-linked turmoil, and the US Federal Reserve's interest rate hike by 0.25% the day before.

The market was upbeat after Fed Chair Jerome Powell’s comments that the US economy was strong and can handle the monetary tightening. The market jumped on Fed’s rate move.

The global crypto market surged 2.43% to US$1.83 trillion, while the volume rose 0.95% to US$94.53 billion in the last 24 hours to Thursday morning. Bitcoin (BTC) and Ethereum (ETH) rose 1.25% to US$40,976.09 and 4.18% to US$2,794.54, respectively, in the same period.

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Wrapped Bitcoin (WBTC) token price and performance                                                   Source: *Data provided by CoinMarketCap.com

Bottom line:

The WBTC token has a market cap of US$11.19 billion, and its fully-diluted market cap is US$11.12 billion. The token's price surged 4.18% over the last 7 days. It is available on exchanges like Binance, OKX, FTX, etc.

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