Wrapped BTC (PoS Polygon)

WBTC

WBTC is a DeFi-compatible version of BTC backed by BTC reserves held by a licensed custodian (BitGo).

Risk Rating

Average

$98,310.00

3.44%

What is Wrapped BTC (PoS Polygon)?

What we like

Enables users to earn yield on their idle BTC holdings across various DeFi apps. Provides access to BTC’s deep liquidity and large volume.

What we like less

WBTC transferred through the Polygon PoS bridge requires more trust assumptions as the bridge depends on external validators. Greater centralization as BitGo custodies the deposited BTC and controls the minting and redemption of WBTC.

What it means for you

WBTC is a highly liquid instrument to gain exposure to BTC directly from other chains and also an easy way to put your BTC to work for you in DeFi.

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Information

Blockchain

Polygon

Info

Key Metrics

Market Cap: $13.2B
Fully Diluted Valluation: $13.2B
FDV / MC: 1
Ranking inside Exponential (excluding stables): #7
Circulating Supply: 133,854
Total Supply: 133,854
Total Supply: 133,854
Volume (24H): $640.1M
ATH: $107,645.00 (12/17/2024)
ATL: $3,139.17 (04/02/2019)

Risk Assessment

Average

Asset Strength

WBTC is a mid-cap, fully collateralized asset. This asset depends on a centralized entity for custody services. This asset is exposed to the underlying risks of Polygon PoS bridge, a protocol rated as Watch out.

Dependencies

Polygon PoS Bridge

Asset Tokenomics

WBTC has a fixed supply. WBTC is a DeFi-compatible version of Bitcoin. It is backed 1:1 by BTC custodied by BitGo. WBTC on Polygon is backed 1:1 by WBTC locked on the Ethereum chain in the Polygon PoS bridge protocol.

Asset Volatility

WBTC is highly correlated to the overall market.

Things to know about WBTC

Who invented WBTC?

WBTC launched on the Ethereum mainnet in January 2019 as a collaboration between major DeFi players, such as BitGo, Ren,and Kyber. The project is now controlled by a decentralized autonomous organization (DAO) called the WBTC DAO.

How does WBTC work?

WBTC is maintained by a decentralized autonomous organization (DAO) that consists of 16 stakeholders within DeFi. The token is minted by a centralized custodian, BitGo. This process is initiated by merchants who send the user’s BTC to BitGo in return for WBTC tokens. Customers are required to undergo KYC checks to verify their identity before wrapping their BTC. Unwrapping the WBTC back to BTC involves the same process with the merchant requesting to burn WBTC and BitGo returning the equivalent amount of BTC. The amount to be redeemed is deducted from the merchant’s WBTC balance (on-chain), thus reducing the circulating supply.

How secure is WBTC?

WBTC will never have the same level of decentralization or security as BTC since it relies on trusting people and organizations to manage the system instead of automated smart contracts. Nonetheless, WBTC regularly undergoes audits and publishes all on-chain transactions and verifications for the Bitcoin and Ethereum networks. Users can always independently verify if the amount of BTC sent to the WBTC address on the Bitcoin blockchain matches the creation of WBTC tokens on the Ethereum blockchain, and vice versa.