Coinbase's newly launched cbBTC, a variation of wrapped Bitcoin, is gaining liquidity on decentralized networks. The majority of trading activity for cbBTC is happening on the Aerodrome DEX, which currently holds over 78% of all activity. Despite this, Uniswap remains the leading liquidity and DEX hub on Base. Ethereum and Base hold the majority of cbBTC tokens, with Coinbase also holding 10%. The launch of cbBTC has created increased flows to L2, with Base benefiting the most. The new asset aims to replace other forms of wrapped BTC and compete with WBTC. Currently, cbBTC activity is primarily driven by market makers and liquidity providers, with limited mainstream adoption. Wallet adoption is slow, with only 356 wallets holding cbBTC. Despite these challenges, cbBTC is seen as a compromise between centralization and the ability to be used on DEX platforms. Its success will depend on replacing existing loans and collaterals denominated in WBTC.



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