Binance, the world’s largest cryptocurrency exchange by market value, is listing another token to help support decentralized finance (DeFi) growth.
Encapsulated Bitcoin (WBTC), a new ERC-20 token tied to the price of Bitcoin (BTC), can now be traded on Binance, according to the exchange’s blog post on August 31.
As officially announced, Binance users can now deposit WBTC and exchange tokens for Bitcoin and Ether (ETH).
Wrapped Bitcoin, launched in 2019, is an Ethereum-based token that represents Bitcoin, with one WBTC equal to one BTC. WBTC is a joint initiative of major DeFi operators such as BitGo, Ren, Dharma, Kyber Network, Compound, MakerDAO and Set Protocol. The token is intended to give the Ethereum network with Bitcoin more liquidity and implement it in the DeFi industry.
As part of the WBTC functionality at DeFi, the token allows Bitcoin holders to manage BTC while DeFi apps like Compound are used to borrow or lend money.
In return for conventional finance, decentralized finance or DeFi, it provides for a completely new currency system based on public blockchains. With DeFi platforms directly connecting borrowers and lenders to avoid credit checks and collateralise digital assets, DeFi has decentralized lending as a key benefit.
The DeFi industry grew exponentially in 2020. The total book value in the market reached $ 9 billion on Aug. 30. Uniswap, the most widely used decentralized exchange on Ethereum, outperformed Coinbase’s flagship platform in daily trading volume on August 30th. Cointelegraph reported earlier today.
As DeFi continues its rapid surge, so does demand for WBTC, reaching $ 274 million in circulation by mid-August.
Binance has been actively involved in the DeFi market this year. In August 2020, Binance started DeFi Staking in collaboration with key players in the industry such as Compound Finance and Kava Labs. In April, Binance released a new DeFi token supported by its ontology (ONT) cryptographic lineage.