Coinbase teases launch of cbBTC, it's vision of a wrapped Bitcoin
Coinbase teases launch of cbBTC, it's vision of a wrapped Bitcoin
Coinbase has hinted at the launch of a new product, cbBTC, possibly a tokenized version of Bitcoin, following recent controversies surrounding BitGo's Wrapped Bitcoin (WBTC) and Justin Sun's involvement.
The announcement, made via a cryptic post on August 13, has sparked speculation that Coinbase's cbBTC could be released on its layer-2 network, Base. This move comes in the wake of concerns raised by the DeFi community about Justin Sun's influence in the WBTC project, potentially leading to increased competition in the tokenized Bitcoin space, Cointelegraph reported.
A wrapped token is a type of cryptocurrency that represents the value of another cryptocurrency on a different blockchain. It is like wrapping a physical asset into a digital form, so it can be used on different platforms.
On August 13, Coinbase ignited speculation with a brief post on X teasing "cbBTC" and the promise of its imminent launch. Industry observers suggest that this could be Coinbase's own version of wrapped Bitcoin, which would allow Bitcoin to be used on Ethereum-compatible blockchains like its own Base network.
In another X post an hour later, Jesse Pollak – the head of Coinbase's Layer-2 network Base – expressed his love for Bitcoin in no uncertain terms.
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This development comes on the heels of a controversy surrounding BitGo’s Wrapped Bitcoin (WBTC), a similar tokenized Bitcoin product.
The controversy erupted after BitGo announced a new joint project with Tron founder Justin Sun on August 9, which many in the decentralized finance (DeFi) community saw as a potential risk. Concerns over Sun's involvement led to calls for WBTC to be removed from major DeFi protocols, prompting Block Analitica, a crypto risk management firm, to propose limiting WBTC's use on MakerDAO.
Coinbase’s move to introduce cbBTC may be seen as a response to these concerns, positioning itself as a more secure alternative. With the details of cbBTC still under wraps, the crypto community is closely watching for further announcements.
As the landscape of tokenized Bitcoin continues to evolve, Coinbase's token could significantly impact the market, offering new opportunities and possibly reshaping the dynamics between competing products.
Read more: Kraken adds 8 new tokens to its platform
