Tokenized Bitcoin (WBTC) took second place in CoinMarketCap's DeFi market capitalization ranking this week.
Jumping from sixth place in the DeFi ranking, the WBTC surpassed the protocols YFI, UMA, DAI and LEND at once, and now sees the leader LINK from afar.
We showed in a post that the WBTC had broken a record on the Ethereum network with over 68,000 tokens issued, and a market capitalization of $ 683 million dollars.
Today, there are approximately 77 thousand WBTC tokens in the Ethereum network, representing a market value of US $ 847 million, an increase of 24% in 4 days.
The number of Bitcoins in custody on the network also increased from 94,000 to more than 108,000 units, up 14.8%.
In the ranking of Tokens, where Tether is the leader, the WBTC occupies the 7th position. In the general ranking of market capitalization the WBTC occupies the 25th position, costing US $ 10,958 dollars per unit.
Wrapped Bitcoin (WBTC)
Since the executive governance of the Maker platform included WBTC as a new guarantee option on decentralized exchanges (DEX) and DeFis, the Bitcoin Token has stood out in the market.
Currently, several other DeFi platforms and exchanges also offer the WBTC Token, such as Compound, Binance, OkeX, Huobi, Curve, AAVE, and Uniswap, among others.
The WBTC is administered by a Decentralized Autonomous Organization (DAO), controlled by multi signed contracts.
It is a standard ERC-20 token backed by 1: 1 with Bitcoin. This means that for each WBTC on the Ethereum network there is 1 Bitcoin held in custody under a smart contract.
The WBTC standardizes Bitcoin to the ERC-20 format, creating direct smart contracts with Bitcoin facilitating the approval of contracts that integrate your transfer.
With the WBTC, greater liquidity was generated to the Ethereum ecosystem, since the largest volume of transactions that occur in the DeFis protocols of centralized and decentralized exchanges is with Bitcoin.
As a result, the network had to maintain multiple nodes and manage different types of transactions to support multiple digital assets, which was more complex and costly.
Now exchanges, trades, wallets and payment applications, and different types of decentralized investments need only deal with one node in the Ethereum network.
The market
The DeFi market brought with it the synthetic cryptography created on Synthetics platforms or operations.
With them it is possible to synthesize and reproduce collateralized Tokens backed by any type of asset, be it cryptocurrencies, FIAT, minerals such as gold, Shares, among others.
These collateralized tokens bring a new feature to the market, because when an asset is kept in custody within networks such as Ethereum, Binance, and Tron, they are transformed into synthetic assets, increasing the number of existing assets to some extent.
Take the example of Bitcoin. At the moment, 18,495,512 BTCs have been mined according to CoinMarketCap, however, 108,000 of them are trapped in custody on the networks and have become 108,000 new tokenized Bitcoin (WBTC).
It is as if there were a greater number of Bitcoins on the market.
So much so that more than $ 1.1 billion dollars in Bitcoin that are in custody has greatly helped the jump in DeFi protocols in market capitalization.
The DeFi market for centralized exchanges has grown a lot, with BINANCE being a leading tokenized asset list.
However, investors can also exchange their cryptocurrencies in tokenized assets on several DEX such as Kyber, Set Protocol, Dharma, Ren, AirSwap, among others.
In exchanges, in order to issue a tokenized asset, the investor must go through a KYC / AML with a platform that provides the user's token to the custodian.
This will then produce the amount of the tokenized asset equivalent to the investment amount requested.
On the other hand, the investor can redeem his cryptocurrency and thus "burn" or destroy the tokenized asset. This can occur automatically when settling a smart contract, for example.
More and more new blockchain products are emerging on the market, and this has created a more comprehensive finance model for cryptocurrencies.
As a result, new forms of investment are emerging in decentralized finance, and have attracted a different range of new investors to the market.
