Coinbase has teased the imminent launch of a new tokenized bitcoin product under the ticker cbBTC, according to a recent post on X (formerly Twitter). This upcoming product appears to be in the same vein as Coinbase’s existing Ethereum staking derivative, cbETH.
While details remain sparse, Coinbase’s cryptic announcement suggests that cbBTC will be launched soon. The tokenized bitcoin product is expected to be backed one-to-one with actual bitcoin, allowing users to hold bitcoin on Ethereum and Layer 2 chains, thus providing liquidity within the Coinbase ecosystem and its blockchain incubated project, Base.
Jesse Pollak, the lead at Base, expressed enthusiasm for the development, stating his team aims to build a significant bitcoin economy on Base.
The launch of cbBTC will position Coinbase’s new product in competition with BitGo’s wrapped bitcoin (WBTC), the largest tokenized BTC product currently on the market with a market cap exceeding $9 billion. BitGo, the custodian of WBTC, has recently announced a partnership with BiT Global, associated with Tron founder Justin Sun, to manage WBTC custody. This joint venture aims to provide “multi-jurisdictional and multi-institutional custody” for WBTC.
The BitGo-BiT Global partnership has raised some security concerns due to Sun’s controversial reputation and the potential centralization of control. In response, Maker DAO’s risk team, Block Analitica Labs, proposed halting new borrowing against WBTC collateral. However, BitGo CEO Mike Belshe defended the firm’s commitment to security and legal oversight, reassuring stakeholders of the custodial integrity of both BitGo and BiT Global.
With cbBTC on the horizon, the market anticipates a new competitor in the tokenized bitcoin space, adding to the evolving landscape of crypto-backed products.
