Coinbase has announced plans to release a new token, cbBTC, on its Layer 2 network, Base. This announcement has sparked speculation about potential competition with the existing Wrapped Bitcoin (WBTC) token.
cbBTC Announcement
Coinbase hinted that a new token, cbBTC, will be launched on its Layer 2 network, Base, in the near future. This announcement was made on August 13 via the official Coinbase account on X. The introduction of cbBTC comes at a time when concerns surrounding WBTC's custodial changes have raised eyebrows.
Base Network and cbBTC
Base, Coinbase’s Layer 2 network, has been gaining traction as a platform for decentralized applications and crypto innovations. Jesse Pollak, the creator of Base, expressed his enthusiasm for Bitcoin, stating that the team aims to build a 'massive Bitcoin economy' on the network. This sentiment reinforces the idea that cbBTC will play a significant role in the future of Base.
Comparing cbBTC and WBTC
While details about cbBTC are still emerging, comparisons to WBTC are inevitable. WBTC has established itself as a widely-used asset in DeFi, with over 154,764 tokens currently in circulation. The recent custodial changes involving WBTC have prompted protocols like MakerDAO and Aave to reassess their positions. Coinbase’s previous success with Wrapped Staked ETH (cbETH) suggests that cbBTC could follow a similar path.
Coinbase’s introduction of cbBTC could set new standards for tokenized versions of Bitcoin, especially amidst the uncertainty surrounding WBTC. The Base network and support from Coinbase might make cbBTC appealing to users and DeFi platforms looking for alternatives.
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