The competition in the Wrapped Bitcoin (WBTC) space is intensifying, with major crypto platforms launching their own products to cater to DeFi and institutional users. U.S.-based exchange Kraken has just unveiled its version, kBTC, following Coinbase’s recent debut of cBTC.
In a blog post published today, October 17, Kraken announced that the Ethereum-based is fully backed 1:1 by Bitcoin held in Kraken Financial, its Wyoming-chartered depository subsidiary. It emphasised its commitment to transparency, stating that clients can verify the reserves anytime by checking them on-chain.
The announcement also highlighted that kBTC holders could use the token not only on Ethereum but also in dApps via interoperability with OP Mainnet (formerly known as Optimism).
Kraken added that the New York-based blockchain cybersecurity firm Trail of Bits conducted an audit of the kBTC’s ERC-20 smart contract. The audit involved a thorough review of the codebase and client architecture to identify and resolve any potential security risks.
Coinbase debuted its Wrapped Bitcoin, “cBTC,” on both Ethereum and Base last month. The exchange claimed the new ERC-20 token enhances Bitcoin’s utility within the DeFi ecosystem by enabling its users to interact seamlessly with Ethereum-based dApps.
Coinbase guaranteed full redeemability for Bitcoin and smooth conversion for the token users. It also noted plans to expand cbBTC’s availability to other blockchains in the near future.
Similarly, on September 3, 21.co, the parent company of 21Shares, launched 21BTC on Ethereum in partnership with Flow Traders. According to the firm, the wrapped Bitcoin token was designed for institutional-grade security, and it eliminates the need for traditional “lock-and-mint” bridges because its underlying Bitcoin is stored in cold storage.
Eliezer Ndinga, Head of Strategy and Business Development for Digital Assets at the firm, emphasised the company’s commitment to applying rigorous asset management practices used in their crypto exchange-traded products to wrapped crypto assets. He noted that users desire greater liquidity while needing assurance that their wrapped assets are secured to the highest standards.
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