WBTC launched in January 2019 as the first major attempt to bring Bitcoin into Ethereum DeFi. The model was simple but controversial: BitGo, a regulated custodian, would hold actual BTC and mint equivalent WBTC tokens on Ethereum. Users could redeem WBTC for BTC through approved merchants. The result was Ethereum-compatible Bitcoin that could be used in Compound, Aave, Uniswap, and every other DeFi protocol.
The adoption was slow at first. Bitcoin maximalists hated WBTC on principle — it required trusting a centralized custodian, which felt like a betrayal of Bitcoin’s whole value proposition. Ethereum users initially had other priorities. But by 2020 DeFi Summer, WBTC had become essential infrastructure. At its peak in 2021, more than $16 billion worth of BTC was wrapped into WBTC, making it one of the largest single holdings of Bitcoin in the world.
Competitors emerged. renBTC, tBTC, sBTC, and several others tried to provide trust-minimized alternatives with less reliance on a single custodian. Most of them either failed or remained niche. WBTC’s first-mover advantage and BitGo’s regulated status kept it dominant. In 2024, BitGo announced a joint venture with Tron founder Justin Sun that would take over WBTC operations, triggering a community panic and a migration of significant WBTC holdings to alternatives like cbBTC (Coinbase’s Bitcoin wrapper). WBTC survived but lost market share.
WBTC’s legacy is that it proved the demand for Bitcoin-in-DeFi was enormous, which opened the door for dozens of subsequent projects trying to solve the problem with better trust assumptions. Babylon, sBTC on Stacks, and various bridge-based approaches all trace part of their rationale to the original WBTC insight: Bitcoin holders want DeFi exposure, and they’ll accept compromises to get it. The only question is which compromise wins in the long run.
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