- Kraken has launched kBTC, a wrapped Bitcoin token
- kBTC is fully backed 1:1 by Bitcoin and is available on Ethereum and Optimism networks
- The token allows users to engage in decentralized finance (DeFi) applications, enabling seamless interaction with decentralized apps (dApps) across different ecosystems
Crypto OG exchange Kraken has introduced kBTC, a wrapped Bitcoin token that is pegged 1:1 to Bitcoin. Available on Ethereum and Optimism networks, the ERC-20-based token is aimed at bridging Bitcoin’s vast liquidity into the decentralized finance (DeFi) space, allowing users to leverage Bitcoin’s value in decentralized applications (dApps). This launch is part of Kraken’s strategy to enhance Bitcoin’s accessibility within the DeFi ecosystem five years after the first wrapped Bitcoins came onto the market.
Bringing BTC to DeFi
Kraken announced kBTC in a press release yesterday, noting that the token will be fully backed by Bitcoin reserves held in Kraken’s custody, providing users with the transparency and security they expect from the platform. “We’re thrilled to launch kBTC, a token that combines the security and trust Kraken has built over the past decade with the power of Bitcoin in the DeFi world,” Kraken stated in its press release.
Kraken aims to position kBTC as a key player in the growing market for wrapped Bitcoin tokens, which also includes competitors like WBTC, cbBTC, and 21BTC. These tokens allow Bitcoin holders to engage in blockchain ecosystems outside of Bitcoin’s own network, making use of faster blockchains and increased utility. According to Kraken, kBTC will offer additional cross-network compatibility as the platform looks to expand into other crypto ecosystems beyond Ethereum.
Wrapped Bitcoin Concept Now Five Years Old
Kraken says that its broader goal with kBTC is to give developers and users new ways to incorporate Bitcoin into smart contracts, DeFi, and other Web3 applications, emphasizing the token’s potential to “push the entire ecosystem forward” and reinforce Bitcoin’s standing as the cornerstone of cryptocurrency innovation.
The first wrapped Bitcoin was WBTC, a joint venture between several entities, including BitGo, Kyber Network, and Ren, which launched in January 2019.
