Coinbase and Base Creator Jesse Pollack Suggest the Crypto Exchange Is Developing a Wrapped Bitcoin Similar to Bitgo's wBTC to Run on the Layer-2 Blockchain

Speculation was sparked by cryptic posts from Coinbase late Tuesday U.S. time. The posts contained the wording:"cbBTC" and"Coming soon."

Coinbase appears to be developing a wrapped bitcoin for layer-2 blockchain, based on posts from the crypto exchange and Base creator Jesse Pollack.

Cryptic posts from Coinbase late Tuesday U.S. time sparked speculation. The posts included the wording: "cbBTC" and "Coming soon."

They were followed by a post from Pollack, who runs Base, discussing how the team plans to build a "massive bitcoin economy" on the network.

A wrapped bitcoin is a way of making it available on protocols other than the one it was originally designed for, bringing increased liquidity to the target ecosystem. Each wrapped bitcoin represents one of the original, which is stored in custody.

The response to the announcement was largely neutral, as there is no technical change to the product and all data about underlying reserves continues to be verifiable on-chain. However, some chatter on the forums of DAI stablecoin issuer MakerDAO — which has a proposal open for the next month for MakerDAO token holders to vote on stopping wBTC borrowing and cutting wBTC debt limits to 0 DAI to reduce risk — brought up the announcement.