Navigating the Wrapped Bitcoin Landscape: 86,000 WBTC Exit Circulation in One Year
Data reveals that since the start of the year, the count of circulating wrapped bitcoins (WBTC) has diminished, plunging by more than 22,000 WBTC. Notably, a year-long assessment reflects an even more significant contraction, with over 86,000 WBTC evaporating from circulation since last July.
A 12-Month Decline of 86,000 WBTC in Circulation
The Wrapped Bitcoin project has been around for over four years, originating as WBTC on the Ethereum blockchain at the dawn of 2019. As of now, WBTC stands as the 16th most valuable asset among a sea of alternative cryptocurrencies, boasting a market value of approximately $4.73 billion. Despite its ranking as the most prominent wrapped bitcoin (BTC) derivative token, a notable contraction in circulating coins has been observed since the previous year.
To illustrate, rewind to July 13, 2022, when the circulating supply of WBTC stood at an estimated 247,832 WBTC. Today, that number has tapered off to 161,460 WBTC. This translates into a reduction of over 86,000 WBTC, or a significant 34% pullback in circulating supply over the past year. Additionally, a comparison of WBTC’s market valuation reveals substantial growth – ascending from a tad above $3 billion on January 2, 2023, to a markedly more impressive figure of $4.73 billion today.
However, this augmentation in value primarily stems from the appreciating price of BTC, which was exchanging hands at $16,662 per unit on January 2. Now, each BTC coin commands a price of $29,328, marking a surge of over 65% since the year’s commencement. Given that WBTC’s prices are tethered to BTC on a 1:1 basis, WBTC’s market capitalization followed suit, even though its circulating supply contracted by 22,088 WBTC in the same period. Thus, of the total 34% reduction since last year, 12.03% of the cutback unfolded in 2023.
Specifically within the Ethereum network, WBTC boasts a total of 74,191 holders. However, the lion’s share of the supply—51.5% to be exact—resides under the control of the top ten addresses. These ERC20-based WBTC tokens are spread across a multitude of decentralized finance (defi) platforms such as Aave, Compound, and Arbitrum. In fact, the top 100 Ethereum-based addresses command 75.16% of the total WBTC supply. Beyond Ethereum, WBTC also finds utility on other blockchains including Arbitrum, Cronos, Fantom, Polygon, Solana, and Avalanche.
What do you think about the number of WBTC removed from circulation over the past 12 months and in 2023? Share your thoughts and opinions about this subject in the comments section below.
Source: Bitcoin.com
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Text source: Crypto Breaking News
