Published on september 27, 2024, 12:35 am
Image source: Fox News
```json [ "TLDR: WBTC remains the top Bitcoin wrapper in the crypto scene with a TVL of nearly $10 billion, despite concerns about its Bitcoin backing. Aave's supply of WBTC hit an all-time high, exceeding 37,000 tokens. Controversies arose over BitGo granting control to BiT Global and Sky initially removing WBTC but later reversing this decision. 21.co plans to integrate Chainlink's proof of reserve into 21BTC for transparency. Despite uncertainties, investors still favor WBTC with a TVL over $9 billion.", ] ```
WBTC, short for Wrapped Bitcoin, continues to maintain its position as the most sought-after Bitcoin wrapper in the crypto space, boasting a total value locked (TVL) of nearly $10 billion, as reported by DefiLlama. Despite concerns surrounding the backing of WBTC with Bitcoin, data from Dune Analytics reveals that the supply of WBTC on Aave, a decentralized lending platform, has surged to an all-time high.
In September, Aave’s WBTC supply on the Ethereum network exceeded 37,000 tokens, equivalent to over $2 billion at current market prices. This impressive milestone in TVL on Aave comes amidst growing skepticism among retail investors in the cryptocurrency sphere regarding the security of the actual Bitcoin reserves upholding WBTC.
Recent developments have stirred some controversies within the crypto community. BitGo, the custodian responsible for holding WBTC’s Bitcoin reserves, made headlines when it granted partial control of the multisignature wallet to Hong Kong-based BiT Global. This move triggered concerns among ecosystem participants about potential misappropriation risks associated with projects affiliated with Justin Sun.
Furthermore, Sky (formerly Maker), a decentralized finance protocol, made significant decisions regarding WBTC. Initially opting to remove WBTC from its platform on September 19th due to underlying apprehensions, Sky later reversed this decision following guidance from key adviser BA Labs. The reversal came after substantial dialogue with BitGo’s co-founder Mike Belshe on Sky’s governance forum. BitGo committed to providing extensive public notice before implementing any alterations related to entities controlling WBTC keys.
In response to mounting concerns about WBTC’s collateralization model, 21.co announced plans on September 23rd to integrate Chainlink’s proof of reserve into 21BTC. This strategic move aims to address apprehensions surrounding the backing of wrapped Bitcoin products like WBTC.
Additionally, Coinbase reassured its users about their cbBTC Wrapped Bitcoin product by confirming that they would reimburse clients if any underlying Bitcoin is lost while using their services. Despite these recent developments and uncertainties within the ecosystem, DeFiLlama data confirms that WBTC remains highly favored among investors as the leading Bitcoin wrapper with a TVL exceeding $9 billion.
As innovation and scrutiny continue in the cryptocurrency landscape, such updates highlight both challenges and advancements in maintaining trust and transparency within decentralized finance platforms like Aave and protocols supporting wrapped assets such as WBTC.
Original article posted by Fox News
