Coinbase’s Wrapped BTC on Solana hits $1B market cap – Impact on SOL

Admin November 8, 2024No Comments

Coinbase introduced its Wrapped Bitcoin on Solana.
Meanwhile, SOL closes in on its ATH.

Coinbase has launched Coinbase Wrapped BTC [cbBTC] on the Solana [SOL] blockchain.

Designed as an SPL token, the wrapped asset is fully backed 1:1 by Bitcoin [BTC] and held securely in Coinbase’s custody.

In a statement on X (formerly Twitter), Coinbase highlighted the significance of this move, saying,

“This is the first token Coinbase has issued on Solana, and with it, we’re excited to bring easy access to BTC.”

cbBTC’s integration into Solana

Coinbase’s introduction of cbBTC to the Solana blockchain follows its announcement at the Solana Breakpoint event in Singapore in late September.

Worth noting that, cbBTC joins an expanding roster of wrapped Bitcoin tokens on Solana, such as tBTC and WBTC (through Wormhole), along with upcoming assets like zBTC from Zeus Network and sBTC from Stacks.

This Bitcoin-backed wrapped token is set to play a pivotal role in Solana’s decentralized finance (DeFi) landscape, providing new opportunities for liquidity and collateral in lending protocols.

From its launch, cbBTC will be supported by prominent Solana-based DeFi platforms.

This included Jupiter Exchange, Meteora AG, Kamino Finance, Jito Labs, Phoenix, Drift Protocol, Raydium, Orca, Save Finance, Manifest, and Loopscale Labs.

Interestingly, 2024 has been quite favorable for Solana on the DeFi front.

As per the latest data from Artemis, Solana’s Total Value Locked (TVL) has surged by 385% YTD. At press time, it stood at $6.8 billion.

cbBTC’s $1B milestone

While cbBTC has now entered Solana, this is not its debut. The token was initially launched on Ethereum [ETH] and Coinbase’s Layer 2 network, Base.

Furthermore, cbBTC reached the $1 billion market cap mark just within nine weeks, a milestone that preceded its Solana launch.

Despite being a relatively new player, cbBTC has already secured its position as the sixth-largest wrapped asset, according to CoinMarketCap.

Among BTC-backed assets, it only trails behind Wrapped Bitcoin [WBTC].

How is SOL performing?

Meanwhile, SOL has rallied by double digits over the last seven days, triggered by BTC’s bull run.

At press time, SOL exchanged hands at $198, around 23% shy of its all-time high (ATH).

As noted by CoinMarketCap, the altcoin saw a daily increase of 5.04% and an impressive 18.55% gain over the past week. The coin’s market capitalization also rose to $93.53 billion, at the time of writing.