Coinbase Expands Wrapped Bitcoin Offering to Solana
Coinbase's wrapped Bitcoin product, cbBTC, has officially launched on the Solana blockchain, marking an important milestone in its efforts to extend its reach beyond Ethereum.
Having made its debut in September, the move to Solana signifies Coinbase's commitment to broadening the scope of its product and enhancing its utility in the fast-growing decentralised finance (DeFi) ecosystem.
What Is cbBTC and How Will It Work on Solana?
Coinbase’s cbBTC functions as an SPL token, which means it can be used for both fungible and non-fungible purposes on the Solana network.
SPL tokens are the native standard for tokens on Solana, providing users with the flexibility to employ cbBTC in various DeFi activities, including trading on decentralised exchanges and using it as collateral in lending protocols.
Backed 1:1 with Bitcoin, cbBTC offers crypto users a way to access Bitcoin's value on networks other than Bitcoin itself, opening up more possibilities for leveraging the world’s most popular cryptocurrency.
Why Is Solana Important for Coinbase’s Strategy?
As Solana continues to grow in popularity, especially within the DeFi space, Coinbase’s move to the blockchain seems like a calculated step to cement its position as a leading player in the crypto industry.
By offering its cbBTC token on Solana, Coinbase is expanding its footprint outside of the Ethereum ecosystem.
The shift comes at a time when Solana has been attracting more attention for its fast transactions and low fees, and several decentralised exchanges (DEXs) are eager to integrate Coinbase’s product.
Solana’s DeFi Ecosystem Welcomes cbBTC
The reception of Coinbase’s cbBTC on Solana has been overwhelmingly positive, with key DeFi platforms like Drift and Orca announcing their support for the token.
Drift, in particular, welcomed cbBTC as a new option for collateral, giving users the ability to use it in their trading activities.
The perpetual futures exchange wrote on X (formerly Twitter):
“Drift welcomes Coinbase wrapped Bitcoin on Solana, cbBTC — will be listed as a spot asset as collateral on Drift. Start using Coinbase's cbBTC as collateral to trade on Drift.”
Meanwhile, Orca hinted to users:
“For a limited time, there are also extra ORCA rewards on cbBTC/SOL pool!”
A New Contender in the Wrapped Bitcoin Space
Since its introduction, cbBTC has quickly become a formidable contender in the wrapped Bitcoin market, which has historically been dominated by BitGo’s WBTC.
Despite WBTC’s impressive market cap of $11 billion, Coinbase’s cbBTC has managed to attract over $1 billion in total value in just nine weeks.
With the launch of cbBTC on Solana, Coinbase is positioning itself to replicate this success in the rapidly expanding Solana ecosystem.
The End of soBTC’s Reign on Solana
The move to Solana is also noteworthy given the troubled history of wrapped Bitcoin on the network.
Prior to Coinbase’s launch, soBTC was the go-to token for wrapped Bitcoin on Solana.
However, following the collapse of FTX and Alameda Research in late 2022, soBTC depegged, leaving many Solana users in limbo.
This makes Coinbase’s cbBTC launch a much-needed development, as it provides Solana users with a reliable, stable alternative.
Coinbase’s Growing Influence Beyond Ethereum
Coinbase’s strategic expansion into Solana aligns with its broader goal of diversifying its offerings beyond Ethereum.
Notably, Solana ranks as the third most traded asset on Coinbase.
At the Solana Breakpoint conference in Singapore, Hassan Ahmed, Coinbase’s Country Director for Singapore, shared this exciting news:
"We recently launched cbBTC on Base, but our users love Solana, and so do we. So we are very excited to announce that we will be bringing native cbBTC to Solana as well."
As Solana’s DeFi ecosystem continues to grow, Coinbase’s latest move with cbBTC reinforces its position as a significant player in the wrapped Bitcoin space, with the potential for even greater success across multiple blockchain platforms.
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