Kraken, a leading cryptocurrency exchange, has recently announced the launch of a new product called kBTC. This new offering is a wrapped Bitcoin product that aims to tap into the rapidly expanding sector of wrapped tokens. According to a statement released on October 17, kBTC is a fully-backed, cross-network-compatible ERC-20 token that represents Bitcoin. Each kBTC token is backed 1:1 by an equivalent amount of Bitcoin, securely stored in Kraken’s custody. The on-chain reserves of kBTC are also available for public verification, ensuring transparency and security. Additionally, the token has undergone audits by the reputable security firm Trail of Bits.
The launch of kBTC aligns with Kraken’s mission to promote global crypto adoption. By offering a wrapped Bitcoin product, Kraken aims to leverage Bitcoin’s strengths while expanding its use cases into decentralized finance (DeFi) and other blockchain ecosystems. The firm has partnered with industry leaders such as deBridge, Definitive, Gauntlet, ParaSwap, and Yearn to support the implementation of kBTC across various networks.
kBTC is designed to be compatible with decentralized applications (dApps) on networks like Ethereum and OP Mainnet. Kraken also has plans to extend its compatibility to other blockchain ecosystems beyond EVM networks. As of the latest on-chain data, the total supply of kBTC is 100 BTC, with a total value of approximately $6.75 million. Currently, 80 kBTC tokens are circulating on the Ethereum network, held by 17 wallets, while the remaining 20 kBTC tokens are on the OP Mainnet, held by 11 holders.
Kraken’s entry into the wrapped Bitcoin space comes at a time of increasing competition in the market. BitGo’s Wrapped Bitcoin (WBTC) currently dominates the market with a market capitalization of $10 billion. In response to this dominance, other players like Coinbase and 21.co have also launched their own wrapped Bitcoin products, namely cbBTC and 21BTC, respectively. The surge in wrapped Bitcoin offerings was further fueled by concerns surrounding BitGo’s partnership with BiT Global, a firm associated with Tron founder Justin Sun. This partnership raised alarms within the crypto community, leading some DeFi protocols to consider discontinuing support for WBTC on their platforms.
In conclusion, Kraken’s introduction of kBTC represents a significant development in the wrapped token space. By offering a fully-backed and transparent wrapped Bitcoin product, Kraken is poised to carve out a niche in the market and contribute to the broader adoption of cryptocurrencies.