- Coinbase’s cbBTC offers Bitcoin holders seamless DeFi access across Ethereum and Base, enhancing Bitcoin’s role in decentralized finance.
- cbBTC allows users to use Bitcoin as liquidity or collateral in DeFi protocols like Aave, Compound, and Spark, boosting utility.
- Coinbase’s trusted custody of Bitcoin gives cbBTC an edge over competitors, ensuring secure and efficient wrapped Bitcoin solutions.
The ERC20 token cbBTC, which is fully backed by Coinbase’s own Bitcoin, was just introduced. Owners of bitcoins can access a range of DeFi applications on Ethereum and Base with cbBTC. This discovery has undoubtedly increased Bitcoin’s incorporation into the DeFi domain.
The usage of Bitcoins just started to grow since Coinbase integrated the Lightning Network for fast and cheap transactions. cbBTC enables users within the Coinbase Network to easily interact with Bitcoin in DeFi without ever having to leave the network. Notably, this measure advances the company’s goal of promoting economic independence by giving clients additional Bitcoin options.
Using DeFi Solutions to Bridge the Liquidity of Bitcoin
The decentralized apps on Ethereum can be accessed by Coinbase users using their existing Bitcoins by using cbBTC. By doing this, Coinbase is filling the gap between Bitcoin’s off-chain liquidity and very effective, cost-effective DeFi substitutes. At launch, cbBTC will be supported on Base and Ethereum, with plans to expand to other chains.
Additionally, cbBTC will have seamless compatibility with several popular DeFi protocols such as Aave, Compound Finance, and Spark. Users can provide Bitcoin as liquidity or use it as collateral for borrowing other crypto assets. This versatility makes cbBTC an attractive asset for DeFi users looking to explore novel financial opportunities.
Coinbase’s Trust Gives cbBTC an Edge Over Competitors
With BitGo’s custodial modifications for Wrapped Bitcoin (WBTC) raising a lot of criticism recently—especially since Justin Sun, the founder of Tron—Coinbase made a move in response. By providing users with a reliable substitute, Coinbase’s established standing as a safe Bitcoin custodian offers cbBTC an advantage.
As a result, Bitcoin’s application in DeFi is now wider than just transactions thanks to this innovation. In order to provide the wrapped Bitcoin market more flexibility, Coinbase’s cbBTC also enables users to trade on decentralized exchanges (DEXs) utilizing Coinbase Wallet.
Through the development of new use cases and increased usage, Coinbase’s cbBTC is poised to transform the role of Bitcoin in decentralized finance. Leads the way in integrating Bitcoin into the larger DeFi ecosystem, and plans to support additional chains in the future.
The post Coinbase Unveils cbBTC: Bringing Bitcoin into DeFi on Ethereum and Base appeared first on Crypto News Land.
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