Coinbase has introduced cbBTC — Coinbase Wrapped BTC — an ERC20 token backed 1:1 by Bitcoin, which Coinbase holds. The cbBTC token is now available on Base and Ethereum.

Wrapped Bitcoin is a tokenized version of Bitcoin that operates on Ethereum or other blockchains, providing BTC holders access to DeFi applications. Coinbase’s cbBTC adds to the wrapped asset category, following similar assets like Wrapped Bitcoin (WBTC).

In August, Coinbase teased a new wrapped Bitcoin product with a cryptic tweet. The official announcement came on Coinbase’s social media account with a simple “cbBTC” and a “coming soon” comment. On September 11, the Base X account tweeted a logo presumed to be for cbBTC.

Details of cbBTC

Coinbase users can now convert their Bitcoin to cbBTC when transferring from their accounts to Base or Ethereum addresses. This token can be utilized in popular DeFi protocols like Aave, Compound, and MakerDAO, enabling users to lend, borrow, and earn yields with their Bitcoin.

CbBTC ensures secure liquidity by being fully backed by Bitcoin held in Coinbase custody, which has a track record of over 10 years. This initiative aims to provide more utility for Bitcoin holders, allowing them to access decentralized finance applications using the Bitcoin they already own.

How cbBTC Works

When sending BTC from Coinbase to an address on Base or Ethereum, it will be automatically converted 1:1 to cbBTC. Conversely, when receiving cbBTC in a Coinbase account, it will be converted 1:1 from cbBTC to BTC.

CbBTC will not have a separate order book or trading pair on Coinbase but will be available to trade on decentralized exchanges (DEXs) using Coinbase Wallet. It may also be listed on other third-party exchanges that support it.

At launch, cbBTC send and receive will be available on Coinbase in the U.S. (excluding New York State), the UK, EEA states, Singapore, Australia, and Brazil. It will also be accessible globally on Base and Ethereum.

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