I was curious that what is difference between the Wraped Coin vs Bitcoin. I still do not know clear about the Wrapped token but I think that Wrapping a coin allows it to be used on a non-native blockchain. Wrapping a token is essentially swapping one token for another token in an equal amount via a smart contract, or code on the blockchain that can store and send funds. but still I do not know the clear cut meaning and also use of The wrapped Tokens.
Just think of a wrapped bitcoin in the same way we think about stable coins, stable coins assure you they will have one unit of fiat for each coin they release, governments also did the same many decades ago when they supposedly had their paper currencies being backed by gold, and now wrapped bitcoins work in the same exact way, as you may notice both exchanges and governments have broken their promises in the past, and I am sure the same will be true for wrapped bitcoin so I do not recommend you use it at all and if you want bitcoin then just buy it and hold it. 
Topic: What is difference between Wrapped Bitcoin and Bitcoin? - page 2. (Read 343 times)
So what's the point to buy and hold this shitcoin e.g. Wrapped Bitcoin?
It was a way to convince Bitcoiners who didn't want to sell their Bitcoin that they could still hold on to their Bitcoin and trade it with shitcoins, or to take advantage especially of those yield farms.
So Wrapped Bitcoin makers (and all other Bitcoin IOU makers) simply say:
"Let us keep your Bitcoin safe, you take these IOUs from us and stake them or use them in liquidity pools and earn your yields and commissions. When you want your Bitcoin back, just swap out the IOUs".
They just wave some custodial nonsense into the mix so people still think they control their Bitcoin and that they can use their Bitcoin on other chains. They can't and they're not.
and when they are insolvent like FTX, its not going to be 1:1 anymore. and it happened already just the same with wETH which was depegged.
so many IOUs were created and people gave up their BTC all for a token they can use in the platform to provide liquidity hoping to gain more on the defi platforms. its kind of a scam but seem to have worked to lure users.
Just like storing funds on Centralized Exchanges, I typically recommend that you only use Wrapped assets for very short term use. For example. If you have Bitcoin and want to purchase a BSC Token, Wrapping your Bitcoin and immediately purchasing the Token is not that bad. Still risky, but less risky than keeping your Bitcoin Wrapped for a long time.
If anything bad happens to Binance, you do NOT want your Bitcoin to be Wrapped. Why hold a fake Bitcoin anyway if you can hold the actual thing. Makes no sense. Just buy and hold Bitcoin, do not trust artificial versions of it because you may get very screwed!
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Regards,
PrivacyG
If anything bad happens to Binance, you do NOT want your Bitcoin to be Wrapped. Why hold a fake Bitcoin anyway if you can hold the actual thing. Makes no sense. Just buy and hold Bitcoin, do not trust artificial versions of it because you may get very screwed!
-
Regards,
PrivacyG
what tranthidung said is 100% correct.
Bitcoin is bitcoin. Wrapped bitcoin is not bitcoin. It's just some token that was given a name with bitcoin in it.
They (the token creators) can basically promise you anything they want (usually it's a promise they'll hold as much real BTC as they release their wrapped token)... If you want bitcoin, don't let anybody sell you some wrapped token instead...
Bitcoin is bitcoin. Wrapped bitcoin is not bitcoin. It's just some token that was given a name with bitcoin in it.
They (the token creators) can basically promise you anything they want (usually it's a promise they'll hold as much real BTC as they release their wrapped token)... If you want bitcoin, don't let anybody sell you some wrapped token instead...
Then in addition to all you've all said, one needs to be very careful especially the newbies when some people are presenting them altcoins or tokens as bitcoin since they have similarities in the name that sounds a little like btc such as BTCs, BCH, BSC, BTS and many other, they will want to convince beginners that they are also bitcoin, but anything that is aside btc and it's common symbol that represe it logo is fake and not bitcoin.
So what's the point to buy and hold this shitcoin e.g. Wrapped Bitcoin?
It was a way to convince Bitcoiners who didn't want to sell their Bitcoin that they could still hold on to their Bitcoin and trade it with shitcoins, or to take advantage especially of those yield farms.
So Wrapped Bitcoin makers (and all other Bitcoin IOU makers) simply say:
"Let us keep your Bitcoin safe, you take these IOUs from us and stake them or use them in liquidity pools and earn your yields and commissions. When you want your Bitcoin back, just swap out the IOUs".
They just wave some custodial nonsense into the mix so people still think they control their Bitcoin and that they can use their Bitcoin on other chains. They can't and they're not.
I have learned to understand the difference between the two Bitcoin is the real deal.. why the Wrapped Bitcoin (WBTC) is something the creator said it's to help users be able to use btc in different blockchain but their hidden intention is to exchange your real btc with that token which might be dis-valued anytime. Just as @tranthidung .
I earlier believe all was Bitcoin before I was cleared here in this forum.
I earlier believe all was Bitcoin before I was cleared here in this forum.
Bitcoin:
- Decentralized
- High security
- Can't be hacked and can't get attacked
- No one can control it
- Independent and wouldn't die because of other coins collapsed.
Wrapped Bitcoin:
- Centralized
- Poor security
- Could be hacked and could get attacked
- The developer control the coin
- Dependent, if Bitcoin collapse, this coin will collapse too.
So what's the point to buy and hold this shitcoin e.g. Wrapped Bitcoin?
- Decentralized
- High security
- Can't be hacked and can't get attacked
- No one can control it
- Independent and wouldn't die because of other coins collapsed.
Wrapped Bitcoin:
- Centralized
- Poor security
- Could be hacked and could get attacked
- The developer control the coin
- Dependent, if Bitcoin collapse, this coin will collapse too.
So what's the point to buy and hold this shitcoin e.g. Wrapped Bitcoin?
You can use wrapped tokens on other blockchains, people use it for DeFi mainly. Before, you couldn't trade two coins from two different blockchains (not in a decentralized way anyway). Now and with Wrapped tokens, you can do that. For example, if you want to exchange BTC for USDT on Ethereum, BSC, or Polygon. WBTC would allow you to do that.
You still shouldn't use them though. Check this article I shared on this topic I made not a long time ago, to understand the risks.
[1] https://bitcointalksearch.org/topic/m.61281800
You still shouldn't use them though. Check this article I shared on this topic I made not a long time ago, to understand the risks.
[1] https://bitcointalksearch.org/topic/m.61281800
what tranthidung said is 100% correct.
Bitcoin is bitcoin. Wrapped bitcoin is not bitcoin. It's just some token that was given a name with bitcoin in it.
They (the token creators) can basically promise you anything they want (usually it's a promise they'll hold as much real BTC as they release their wrapped token)... If you want bitcoin, don't let anybody sell you some wrapped token instead...
Bitcoin is bitcoin. Wrapped bitcoin is not bitcoin. It's just some token that was given a name with bitcoin in it.
They (the token creators) can basically promise you anything they want (usually it's a promise they'll hold as much real BTC as they release their wrapped token)... If you want bitcoin, don't let anybody sell you some wrapped token instead...
Wrapped Bitcoin is not Bitcoin on Bitcoin blockchain.
These wrapped ones are tokens on many chains that can be Ethereum chain, Binance Smart Chain, Solana chain and any other chains. These tokens are promised by their teams that they are backed by bitcoin with 1:1 rate.
Because, wrapped tokens have pegs, they can lose pegs (de-pegs) like stable coins de-peg (UST, TUSD etc.)
A beginner's guide to understanding wrapped tokens and wrapped Bitcoin
What’s Happening With Wrapped Bitcoin on Ethereum?
You will ask a question "Why were these wrapped tokens created?"
These wrapped ones are tokens on many chains that can be Ethereum chain, Binance Smart Chain, Solana chain and any other chains. These tokens are promised by their teams that they are backed by bitcoin with 1:1 rate.
Because, wrapped tokens have pegs, they can lose pegs (de-pegs) like stable coins de-peg (UST, TUSD etc.)
A beginner's guide to understanding wrapped tokens and wrapped Bitcoin
What’s Happening With Wrapped Bitcoin on Ethereum?
You will ask a question "Why were these wrapped tokens created?"
- They were created to steal your bitcoins.
- Rather than buying and holding bitcoins, you buy these tokens and use them on other blockchains. When they de-peg to zero, you have a wrapped token in hand and have no bitcoins.
I was curious that what is difference between the Wraped Coin vs Bitcoin. I still do not know clear about the Wrapped token but I think that Wrapping a coin allows it to be used on a non-native blockchain. Wrapping a token is essentially swapping one token for another token in an equal amount via a smart contract, or code on the blockchain that can store and send funds. but still I do not know the clear cut meaning and also use of The wrapped Tokens.
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