What is Wrapped Bitcoin?
Wrapped Bitcoin (WBTC) is an ERC-20 token pegged 1:1 to Bitcoin, enabling BTC holders to participate in Ethereum-based DeFi protocols that cannot natively hold Bitcoin. Each WBTC is minted by a custodian — historically BitGo — only when an equivalent amount of BTC is locked in reserve, and can be redeemed (burned) back to BTC at any time through registered merchants. It is the most widely used tokenized Bitcoin on Ethereum, with its reserves publicly auditable on-chain.
WBTC bridges the liquidity of Bitcoin with the programmability of Ethereum. When a user wants to supply BTC to a lending protocol such as Aave or provide liquidity on Uniswap, they send BTC to a custodial merchant, who instructs BitGo to mint an equivalent WBTC balance on Ethereum. The minting and burning records are fully transparent, and the on-chain proof-of-reserves can be verified at any time by comparing the WBTC total supply against BitGo's published BTC wallet. This design has made WBTC the dominant form of tokenized Bitcoin in DeFi, used as collateral, a trading pair, and a yield source across dozens of protocols.
The critical and durable risk in WBTC is custodial centralization. BitGo holds the underlying BTC and, if it were to be hacked, insolvent, or legally compelled to freeze assets, WBTC holders on Ethereum would face losses. This stands in direct contrast to trustless bridging approaches and is a known philosophical tension for a project built on the premise of extending Bitcoin's reach. In 2024 a transfer of WBTC custody to a joint venture involving BiT Global and Justin Sun prompted significant community concern and migration of collateral out of DeFi protocols, illustrating how sensitive the trust assumption is in practice. Governance over the WBTC DAO involves multiple entities, but the custodial layer remains a single point of systemic risk.
Sources
Reviewed by the 2Bitcoins Editorial Team · Updated . Not financial advice.
Wrapped Bitcoin FAQ
Is Wrapped Bitcoin actually backed by real BTC?+
Yes. Each WBTC is backed 1:1 by Bitcoin held in reserve by the custodian (currently BitGo and associated entities). The BTC collateral is held in verifiable on-chain wallets, and the total supply of WBTC can be cross-referenced against published reserve addresses at any time. WBTC.network publishes the current proof-of-reserves dashboard.
Can I convert WBTC back to real Bitcoin?+
Yes. Redemption is available through registered WBTC merchants. A user sends WBTC to a merchant, who initiates a burn transaction on Ethereum and releases an equivalent amount of BTC from the custodial reserve to the user's Bitcoin address. Direct retail redemption is not available — only whitelisted merchants can trigger mints and burns.
How does WBTC differ from other tokenized Bitcoin options?+
WBTC uses a centralized custodian model, meaning trust is placed in BitGo to hold the underlying BTC. Alternatives such as renBTC (now defunct) and tBTC take different approaches — tBTC, for example, uses a decentralized threshold signature scheme backed by a crypto-economic bond rather than a single custodian, trading liquidity for reduced counterparty risk.
Wrapped Bitcoin key numbers
Where to buy Wrapped Bitcoin
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Wrapped Bitcoin Markets
| # | Exchange | Pair | Price | Volume (24h) | Trust |
|---|---|---|---|---|---|
| 1 | WBTC/BTC | $64,105.00 | $7.81M | — | |
| 2 | WBTC/USDT | $64,053.00 | $3.82M | — | |
| 3 | WBTC/USDT | $64,064.00 | $5.20M | — | |
| 4 | WBTC/BTC | $64,041.00 | $585.53K | — | |
| 5 | WBTC/USDT | $64,074.00 | $2.74M | — | |
| 6 | WBTC/USDC | $64,143.00 | $326.80K | — | |
| 7 | WBTC/USDT | $64,075.00 | $1.86M | — | |
| 8 | WBTC/USDT | $64,076.00 | $322.00K | — | |
| 9 | WBTC/XBT | $64,197.00 | $98.85K | — | |
| 10 | WBTC/BTC | $64,087.00 | $111.77K | — | |
| 11 | WBTC/USDC | $64,065.00 | $223.31K | — | |
| 12 | WBTC/USDT | $64,054.00 | $558.28K | — | |
| 13 | WBTC/BTC | $64,075.00 | $185.93K | — | |
| 14 | WBTC/USDT | $64,208.00 | $578.14K | — | |
| 15 | 0X2260FAC5E5542A773AA44FBCFEDF7C193BC2C599/0XC02AAA39B223FE8D0A0E5C4F27EAD9083C756CC2 | $64,065.00 | $25.69M | — | |
| 16 | WBTC/BTC | $64,061.00 | $155.38K | — | |
| 17 | WBTC/USDT | $64,082.00 | $272.26K | — | |
| 18 | WBTC/BTC | $64,051.00 | $1.88M | — | |
| 19 | WBTC/USDT | $64,147.00 | $58.55K | — | |
| 20 | WBTC/USDT | $64,127.00 | $4.71M | — |