With the launch of Coinbase Wrapped BTC, or cbBTC, a major cryptocurrency exchange Coinbase has sent out an urgent warning to the cryptocurrency community.
Coinbase is launching cbBTC, or Coinbase Wrapped BTC, an ERC20 token that is 1:1 backed by Coinbase’s Bitcoin (BTC) as of right now. With intentions to support more chains, cbBTC will be supported on Ethereum and Base at launch.
The cautionary note from Coinbase draws attention to the existence of dishonest parties looking to profit from the introduction of cbBTC. Coinbase warned customers in a tweet about dishonest individuals posing as cbBTC.
https://x.com/coinbase/status/1834208549175484591
The correct contract addresses for the recently introduced cBTC coin on Ethereum and Base, the two blockchains on which it is now issued, were also shared by Coinbase.
The caution from Coinbase emphasises how crucial it is to exercise caution and double-check contract addresses in order to prevent falling for this kind of fraud.
cbBTC debuts on-chain
With the introduction of cbBTC, a wrapped form of Bitcoin backed 1:1 by BTC kept in Coinbase’s custody, Coinbase has ushered in a new age for DeFi.
This would be the first time that low-cost, fast financial rails on Ethereum and Base are connected to deep off-chain Bitcoin liquidity by Coinbase.
By moving assets across several chains, wrapped assets like cbBTC are expected to aid in the growth of a more effective, integrated, and expansive financial ecosystem.
Coinbase’s cbBTC seeks to provide customers additional choices for how to spend their Bitcoin in order to promote economic freedom.
On Coinbase, there won’t be a distinct order book or trading pair for cbBTC. Coinbase automatically converts Bitcoin to cbBTC 1:1 when consumers move their Bitcoin from Coinbase to an address on Ethereum or Base. Customers get cbBTC, which is converted 1:1 to BTC when deposited into their Coinbase accounts.
