Wrapped Bitcoin (WBTC) is an ERC-20 token, and WBTC represents Bitcoin (BTC) on the Ethereum blockchain. A key benefit of WBTC is its integration into the sector of Ethereum wallets, dapps, and smart contracts.
WBTC is maintained through a group known as the WBTC DAO that now includes over 30 contributors. It was initially commenced via BitGo, Ren, and Kyber.
WBTC made use of a custodian model to enforce the tokenization of Bitcoin on Ethereum. What does it mean for every WBTC minted into existence? An equivalent quantity of Bitcoin held in custody in a 1:1 ratio is completely backed. The WBTC stays in circulation until the Bitcoin backing it’s withdrawn, and the equivalent WBTC is burnt. This technique is much like how TUSD operates, except that WBTC benefits from the ease of transparency with all custodian price ranges being completely verifiable on-chain.
