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Bitcoins Are Being Tokenized Faster Than They’re Mined as DeFi Craze Continues

Bitcoins Are Being Tokenized Faster Than They’re Mined as DeFi Craze Continues

Bitcoins Are Being Tokenized Faster Than They’re Mined as DeFi Craze Continues

The decentralized finance craze is causing demand for tokenized bitcoin to surge.

The decentralized finance craze is causing demand for tokenized bitcoin to surge.

The decentralized finance craze is causing demand for tokenized bitcoin to surge.

AccessTimeIconAug 15, 2020, 2:45 PM
Updated Aug 19, 2021, 3:43 AM

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Since Sunday, 1,043 more bitcoins were tokenized through wrapped bitcoin than were actually created by bitcoin miners as the Ethereum-based decentralized finance (DeFi) boom shows no signs of abating.

  • About 900 bitcoins are mined per day, given the current issuance rate of 6.25 bitcoins minted per block and the target 10-minute block time.
  • At last check, nearly 31,000 bitcoins have been tokenized on Ethereum, according to Dune Analytics, 75% of which were minted by wrapped bitcoin (WBTC).
  • Ethereum’s supply of tokenized bitcoins hovered below 3,000 until mid-May, when the rate of new tokens shot up.
  • The rate of bitcoin tokenization signals the surging demand to use bitcoin in the burgeoning network of Ethereum-based DeFi applications.
  • “WBTC continues to exhibit strong growth as demand for bitcoin in DeFi has exploded,” said Kyle Davies, co-founder of Three Arrows Capital, in a private message with CoinDesk. “I expect this trend to continue,” he added.
WBTC and BTC issuance since August 9
  • In July, Three Arrows Capital minted its tokenized bitcoins through BitGo, the company that helped spearhead wrapped bitcoin in 2019.
  • Within a year, WBTC will be a “first class asset” in the decentralized finance ecosystem, predicted Three Arrows co-founder Su Zhu, “just as USDC and USDT are now.”

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