1.3% of Bitcoin’s supply has now been wrapped onto Ethereum

Quick Take

  • A growing amount of bitcoin’s circulating supply is being tokenized on Ethereum.
  • The most popular version is wrapped bitcoin, which accounts for 80% of tokenized bitcoin.
advertisement

A considerable percentage of Bitcoin’s circulating supply has now been locked up to be utilized on the Ethereum blockchain. 

According to The Block’s Data Dashboard, 240,000 bitcoin has now been wrapped onto Ethereum. This represents 1.3% of its current circulating supply (and 1.1% of Bitcoin’s eventual total supply). 

The amount of tokenized bitcoin has increased by 100,000 BTC since the start of the year and has been growing at a rapid clip.

The tokenization process works by locking up an amount of bitcoin and issuing an equivalent number of tokens on Ethereum. The bitcoin-backed tokens are pegged to bitcoin’s price but can also be used on DeFi platforms and in other protocols. To reverse the process, the tokens are destroyed and the bitcoin released.

The majority of the tokens have been turned into wrapped bitcoin (WBTC). WBTC accounts for 80% of the tokens wrapped onto Ethereum, and these tokens alone represent 1% of Bitcoin’s circulating supply.

Other tokenized versions of bitcoin include HBTC, renBTC, imBTC, sBTC and tBTC. HBTC is crypto exchange Huobi’s version of tokenized bitcoin. The other four are run through protocols that enable users to transfer to their versions of tokenized bitcoin and back again. 

For more stories like this, make sure to subscribe to The Block on Telegram.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Trending Stories

Get Your Crypto
Daily Brief

Delivered daily, straight to your inbox.

DAOs: An Institutional Guide to Decentralized Governance

Arca provides fundamental information about decentralized autonomous organizations (DAOs) for institutions transitioning into the age of tokenized ecosystems. This guide explores the components, purpose, functions, and practical applications of these nascent entities and the opportunities and challenges for this compelling governance approach.
Read Full Story
Sponsored Post

Layer-2 Scaling Solutions: A Framework for Comparison - Commissioned by Polygon

Ethereum had a breakout year in 2021. It’s native asset, ETH’s, market capitalization surpassed $500 billion for the first time. Its network facilitated upwards of $7 trillion value transfer. Non-fungible tokens (NFTs) emerged as another “killer application” that have put its technology on the global stage and caught the attention of the masses.
Read Full Story
May 5, 2022, 3:17PM UTC
More