The total number of WBTC, i.e., Bitcoins wrapped on Ethereum, has been increasing significantly. WBTC issuance since August 9 has exceeded the total number of Bitcoin mined at the same time. While this tells of high demand for WBTC, many people have likened the surge as a result of the booming DeFi market.
WBTC issuance exceeds Bitcoins’
In a recent tweet, Zack Voell, a digital currency analyst, shared that the top cryptocurrency is being tokenized to be used on Ethereum more than they are issued. As Voell shared from Dune Analytics and CoinMetrics, WBTC issuance as August 9 totalled 6,785, while Bitcoin mined at the same time was only 5,738.
Due to the base structure of Bitcoin, it was almost impossible to transfer the crypto to the Ethereum blockchain. Then cam WBTC, which enabled users to convert their Bitcoin on Ethereum and use it on Decentralized Finance (DeFi) protocols as WBTC. As more Bitcoin is being tokenized on Ethereum, it indicates that there is a high demand for Bitcoin amongst DeFi user.
The increase in WBTC issuance is probably contributing to the growing amount of values locked in DeFi. As Cryptopolitan reported, the number of cryptos locked in DeFi has totalled over $6 billion.
Bitcoin now a key part of DeFi
In line with the surging WBTC issuance, Ren’s chief technical officer of Ren, Loong Wang, commented:
“Bitcoin is now an undeniable part of DeFi, with $420M USD of BTC on Ethereum, in one form or another. In the last 24 hours, over $24M has been moved through Ren to be used to farm yield. Anyone not generating APY right now with their BTC is asleep.”Meanwhile, Coinbase’s Max Bronstein opined that the rising demand for WBTC is also due to the incentives in holding BTC on Ethereum. Bronstein mentioned that Curve Finance users receive over one percent daily to long Bitcoin.