Do you know what's the difference between $BTC and $WBTC ?

Understanding Wrapped Bitcoin (WBTC) and its Role in Interoperability

Blockchains operate independently, meaning cryptocurrencies like Bitcoin (BTC) are native to their respective blockchains (in this case, the Bitcoin blockchain).

This isolation presents a challenge for interoperability between different blockchain ecosystems.

To bridge this gap, wrapped assets like Wrapped Bitcoin (WBTC) are introduced. WBTC represents a 1:1 value equivalent with BTC, but it exists on the Ethereum blockchain.

This allows users to leverage the functionalities and applications of the Ethereum ecosystem while still holding the value of Bitcoin.

A crucial aspect of wrapped assets is maintaining a finite and secure supply.

To ensure this, a process known as "pegging" is employed. For every WBTC issued, an equal amount of BTC must be locked and held in a secure reserve on the Bitcoin blockchain.

This 1:1 backing guarantees that the supply of WBTC remains tethered to the actual supply of BTC, preventing the risk of inflation or devaluation of the wrapped asset.