Crypto exchange %Kraken has launched a new wrapped %Bitcoin (CRYPTO: $BTC) token called “kBTC.”
The token is available on the Ethereum mainnet, and will be backed 1:1 with Bitcoin, the company said.
So called “wrapped tokens” allow unsupported cryptocurrencies such as Bitcoin and %Ethereum (CRYPTO: $ETH) to be traded, lent and borrowed on decentralized finance (DeFi) platforms.
The largest such token, WBTC, allows investors to use Bitcoin on other blockchains and has a market capitalization of $10 billion U.S.
Kraken is not the only crypto company to launch a wrapped Bitcoin token this year.
Rival crypto exchange %Coinbase (NASDAQ: $COIN) launched its own wrapped Bitcoin product, called “cbBTC,” on the Ethereum network in September.
Kraken said the minimum deposit for kBTC will be 0.00026 Bitcoin, which is around $15 U.S., assuming a Bitcoin price of $60,000 U.S.
The token launch is part of Kraken’s efforts to grow the adoption of DeFi, and kBTC is expected to be widely used across the ecosystem, say analysts.
Kraken is a privately held company. Its stock does not trade on a public exchange.