Originally published on: October 17, 2024
Kraken, a leading cryptocurrency exchange, has made a splash in the digital asset world by introducing Kraken Wrapped Bitcoin (kBTC). This new token is designed to represent Bitcoin holdings stored by Kraken and is backed 1:1 by actual Bitcoin held in the company’s custody.
What makes kBTC unique is its interoperability with various networks, including Ethereum and OP Mainnet, allowing users to engage with decentralized applications (DApps). Kraken stated that by launching kBTC, they are extending the power of Bitcoin to new networks while leveraging their established trust and security expertise.
The Bitcoin backing kBTC is securely held by Kraken Financial, a special purpose depository institution based in Wyoming. To ensure the integrity and security of the kBTC ERC-20 smart contract, the codebase underwent a thorough audit conducted by Trail of Bits, a reputable security firm known for their work on major blockchain projects.
Interested users can easily verify the on-chain reserves of kBTC by checking the provided links to the kBTC OP Mainnet and ETH smart contracts, as well as the BTC custody address. This transparency adds an extra layer of trust and confidence for those engaging with the token.
Wrapped tokens like kBTC serve as a bridge between different blockchain networks, allowing assets to be utilized across platforms. For example, WBTC enables Bitcoin to be accessed on the Ethereum blockchain, expanding its utility and accessibility for users of various applications.
With the introduction of kBTC, Kraken joins the growing trend of wrapped cryptocurrencies, offering a secure and reliable option for DeFi enthusiasts and investors looking to explore new opportunities in the digital asset space.