This token is backed 1:1 by Bitcoin held securely by Coinbase, which brings a new level of utility to Bitcoin holders.
Initially, cbBTC will be supported on the Base and Ethereum networks, with plans to expand to additional chains in the future.
cbBTC Bridges Bitcoin to Ethereum and Base Networks
The launch of cbBTC marks a significant step in enhancing economic freedom for cryptocurrency users. By bridging Bitcoin with Ethereum, Coinbase allows users to utilize their Bitcoin in various DeFi applications. This follows Coinbase’s earlier Lightning Network integration, which enabled instant, low-cost Bitcoin payments.
With over a decade of experience, Coinbase is known for securely managing billions in Bitcoin. This experience spans both institutional and individual customers globally. cbBTC leverages this trust by connecting Bitcoin liquidity with the efficient financial infrastructure of Base and Ethereum.
Source: X
The introduction of cbBTC aims to address a crucial gap by enabling Bitcoin holders to interact with on-chain financial systems more effectively. Users can now provide Bitcoin as liquidity or collateral in DeFi protocols, accessing new financial opportunities.
More About cbBTC
cbBTC has launched on Ethereum and Base, raising questions about Coinbase expanding native support to other Layer-2 networks. cbBTC’s current rollout gives Base a special advantage. This contrasts with wBTC, which was more neutral, launching on Ethereum and later being bridged to other networks independently.
cbBTC only launched on Ethereum and Base.
Will they roll out native cbBTC on other L2s?
We might dislike wBTC, but it was at least neutral—launched on Ethereum with bridged versions launched independently. No L2 had special advantage. https://t.co/bjjLItOApJ
— Ignas | DeFi (@DefiIgnas) September 12, 2024
Source: X
With cbBTC, the focus on Base creates potential for concerns about preferential treatment, as no other L2s have yet received native support. Whether Coinbase will extend cbBTC to additional L2s remains to be seen.
Conclusion
On launch day, many popular DeFi applications will support cbBTC. This will provide immediate access to these novel use cases. By integrating Bitcoin into the Ethereum and Base ecosystems, Coinbase is pioneering a new era for decentralized finance. This will make it easier for users to utilize their Bitcoin holdings in innovative ways.
Disclaimer
The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.
