cbBTC: Bitcoin with DeFi superpowers

This week’s token highlight is Coinbase Wrapped Bitcoin. It lets you access Bitcoin’s value while tapping into DeFi across Ethereum, Base, Arbitrum, and Solana.

You can now claim some cbBTC in the Fluidkey app based on your Fluidkey Score. As soon as it gets dropped in your account you can start earning yield on it automatically thanks to our auto-earn feature.

Bitcoin has established itself as the number one store of value cryptocurrency but it lacks the programmability of EVM chains. With cbBTC you get the best of both worlds: you can for example earn yield on your Bitcoin or borrow USDC against it.

So what’s the catch? Unlike BTC which can be held without any intermediaries, cbBTC is custodied by Coinbase. You can think of it as USDC for Bitcoin. The same way one USDC is backed by one US Dollar held by Circle, one cbBTC is backed by one Bitcoin held by Coinbase. To verify this, users can check cbBTC’s proof of reserves page.

cbBTC isn’t the only option to access Bitcoin across EVM chains. wBTC is another popular option with strong liquidity across chains and DeFi protocols.

Moving Bitcoin to EVM chains without going through a centralized exchange or paying extremely high fees is not straightforward. tBTC is a great decentralized option to bridge Bitcoin to EVM chains. Once you hold tBTC, you can also swap it into cbBTC or wBTC at very good rates. In our tests, bridging BTC to tBTC on Base and then swapping tBTC for cbBTC cost a total of 0.22% in fees.

See you next week!

Note that none of our highlights are financial advice. The value of any of the tokens highlighted may go to zero.