WBTC/BTC: Convert and Swap Wrapped Bitcoin (WBTC) to Bitcoin (BTC)

Wrapped Bitcoin (WBTC) is a unique cryptocurrency that operates on the Ethereum blockchain, while maintaining a value pegged to Bitcoin. It's an ERC-20 token, which means it's compatible with the Ethereum network's standard, allowing it to be integrated into the Ethereum ecosystem. This integration enables WBTC to be utilized in various decentralized finance (DeFi) applications, such as decentralized exchanges and crypto lending services. The value of WBTC is backed by Bitcoin at a 1:1 ratio, maintained by a network of merchants and custodians. This ensures that the price of WBTC is always equivalent to Bitcoin, facilitating the transfer of liquidity between the Bitcoin and Ethereum networks.

The creation and operation of Wrapped Bitcoin is a process that brings Bitcoin into the world of Ethereum's DeFi ecosystem. When a user wants to convert their Bitcoin into WBTC, the Bitcoin is held by a custodian who participates in the minting and burning of Ethereum-based tokens. During minting, users send Bitcoin to the custodian for storage and receive an equivalent amount in WBTC tokens. When WBTC tokens are burned, the user can reclaim their Bitcoin balance from the custodian. The WBTC DAO, consisting of governing members, decides on significant upgrades and changes to the protocol. These members can also serve as merchants or custodians managing Bitcoin assets.

Wrapped Bitcoin, being an ERC-20 token, can be used across the broader Ethereum ecosystem. This includes trading on decentralized exchanges and exploring DeFi opportunities through protocols and platforms that support WBTC. These opportunities range from lending and borrowing to yield farming, token swapping, and liquidity pools. WBTC can also be used as collateral for a crypto-backed loan, providing a viable option for businesses. Additionally, WBTC holders can earn from supplying liquidity. Another potential use case for WBTC is in margin trading, where it can be used to margin trade Ethereum, stablecoins, and other ERC-20 tokens.

Wrapped Bitcoin is a part of the Wrapped Tokens project, a joint initiative of three organizations: BitGo, Kyber Network, and Ren. BitGo, an institutional digital asset custody, trading, and financial services firm, serves as the original custodian of WBTC. Kyber Network and Ren, both focused on cross-blockchain integration of cryptocurrency assets and DeFi applications, have helped create WBTC and serve as merchants on its network. The project was first announced on October 26, 2018, and officially launched on January 31, 2019. The number of WBTC tokens in circulation is directly dependent on the amount of Bitcoin reserves in the WBTC network, with no predetermined schedule of WBTC issuance.

Bitcoin (BTC) is a decentralized cryptocurrency that was first described in a 2008 whitepaper by an individual or group of individuals using the pseudonym Satoshi Nakamoto. Launched in January 2009, Bitcoin is a peer-to-peer online currency that enables transactions to occur directly between equal, independent network participants without the need for an intermediary. Bitcoin was created with the intention of allowing online payments to be sent directly from one party to another without going through a financial institution. Bitcoin is the first-ever cryptocurrency to come into actual use and has inspired the development of thousands of competing projects. The entire cryptocurrency market, now worth more than $2 trillion, is based on the idea realized by Bitcoin: money that can be sent and received by anyone, anywhere in the world without reliance on trusted intermediaries, such as banks and financial services companies.

Bitcoin operates on a technology known as blockchain, a decentralized ledger of all transactions that is used to record transactions across many computers so that any involved record cannot be altered retroactively, without the alteration of all subsequent blocks. Bitcoin transactions are verified by network nodes through cryptography and recorded on the blockchain. Bitcoin mining, the process by which new bitcoins are entered into circulation, involves solving computationally difficult puzzles to discover a new block, which is added to the blockchain. The supply of Bitcoin is limited and will never exceed 21,000,000 coins. New coins are created during the process known as mining, where transactions are added to blocks, which are in turn added to the blockchain.

Bitcoin's most unique advantage is that it was the first cryptocurrency to appear on the market. It has managed to create a global community and has given birth to an entirely new industry of millions of enthusiasts who create, invest in, trade, and use Bitcoin and other cryptocurrencies in their everyday lives. Bitcoin's primary use case is as a decentralized store of value. In other words, it provides for ownership rights as a physical asset or as a unit of account. Bitcoin also aims to be a medium of exchange for goods and services, although it is currently used more for the former than the latter.

Bitcoin's original inventor is known under a pseudonym, Satoshi Nakamoto. As of 2021, the true identity of the person — or organization — that is behind the alias remains unknown. On October 31, 2008, Nakamoto published Bitcoin’s whitepaper, which described in detail how a peer-to-peer, online currency could be implemented. Just two months later, on January 3, 2009, Nakamoto mined the first block on the Bitcoin network, known as the genesis block, thus launching the world’s first cryptocurrency. The first known Bitcoin commercial transaction occurred on May 22, 2010, when programmer Laszlo Hanyecz traded 10,000 Bitcoins for two pizzas. This event is now known as “Bitcoin Pizza Day.” Over the years a large number of people have contributed to improving the cryptocurrency’s software by patching vulnerabilities and adding new features. Bitcoin’s source code repository on GitHub lists more than 750 contributors.