BitGo Wrapped Bitcoin Registers 65% Market Dominance

Binance Research’s latest monthly report suggests that Wrapped Bitcoin (WBTC), the wrapped version of Bitcoin (BTC), dominates the tokenized BTC market. Noteworthy, this product, developed by BitGo, Kyber Network, and Ren, continues to maintain this position despite the criticism it is faced with. 

This WBTC allows crypto users to access BTC on the Decentralized Finance (DeFi) landscape. On blockchains like Ethereum and Solana, this product represents Bitcoin 1:1. 

BitGo Partnership Fuels Positive Metrics 

Based on the Binance Research report, WBTC’s weekly transactions reached an all-time high (ATH) of 123,200. For the first time, its weekly transactions surpassed 100,000 for several consecutive weeks. Also, WBTC’s supply has exceeded 152,400, and this figure represents over 65% of the market share. The outlook of these metrics was triggered by a number of factors. 

Two months ago, BitGo announced its partnership and joint venture with BiT Global. The alliance involved moving the WBTC business to multi-jurisdictional and multi-institutional custody. Tron founder Justin Sun was also part of this partnership, which saw BitGo expand WBTC’s operations to Hong Kong and Singapore. The partnership also aimed to redesign WBTC’s custody structure.

BitGo Community Raises Concerns of Counterparty Risks

This event earned the project some criticism from community members, especially about Sun’s involvement. However, it equally contributed to the positive metrics recorded today. Sun’s track record with other affiliated products is the main source of concern for these entities. They perceive the possibility of counterpart risks

Projects like Sky, formerly known as Maker, decided to offload its WBTC in response to the new WBTC control and ownership. The offloading process commenced on October 3, and it is planned to be completed by November 28. Similarly, SparkLend, which holds $61.38 million in WBTC-backed collateralized debts, is also considering alternative wrapped Bitcoin for collateral.

Coinbase Launch its Version of Wrapped Bitcoin 

Amidst this search, the American cryptocurrency exchange hinted at the launch of a new product, tentatively named “cbBTC.” 

Towards the end of September, the exchange finally announced its plan to roll out its wrapped version of Bitcoin. cbBTC has been included in the Ethereum and Base networks and is now preparing to go on to Solana. 

So far, the Coinbase-wrapped Bitcoin has gained significant popularity. It may become the next product in the contest for WBTC’s dominance.