Bitcoin’s value on Ethereum has fallen from around 270,000 a little over a month ago to around 240,000 in August 2022, supporting a trend seen in similar types of cryptocurrencies.
Based on the current bitcoin price, we can see that the value of this amount of cryptocurrency has decreased significantly.
This drop is visualized on one of the dashboards posted by @eliasimos on the Dune analytics platform, analyzing several wrapped cryptocurrencies exchanging hands on the Ethereum blockchain.
These are synthetic cryptocurrencies of the major cryptocurrencies like Bitcoin, created to be compatible with other blockchains.
The latest data from August 12, 2022 shows that Bitcoin accounts for 3.44% of the market cap and 1.384% of the total Bitcoin tokens on Ethereum.
From the analysis we can see that between June 2022 and August 2022 all 7 analyzed registered a drop in the cliff region indicated by the red arrow:
Some examples of wrapped Bitcoin on Ethereum are:
- wBTC (wrapped bitcoin)
- hBTC (Huobi BTC)
wBTC (Wrapped Bitcoin) is the most common of these synthetic cryptocurrencies and is a tokenized version of Bitcoin (BTC) running on the Ethereum (ETH) blockchain.
It is an ERC-20 token, which is the default token type for fungible tokens that can be staked across the Ethereum ecosystem, including:
- Decentralized exchange
- Prediction Markets
- NFT platforms
- lending platforms
On these platforms, representing hundreds of dApps on the Ethereum network, Bitcoin holders try to take advantage of the opportunities offered by the various DefF protocols on Ethereum, such as: B. Staking and yield farming.
People are also converting their bitcoins into wrapped bitcoins (wBTC) to use on Ethereum as collateral for loans.
wBTC has a 1:1 ratio to Bitcoin and allows those looking to convert BTC to ETH, allowing liquidity to move across the 2 largest blockchains, even though Bitcoin only resides on its own blockchain.
Finally, stablecoins, a key liquidity driver for crypto, have remained steady on Ethereum over the past month, with the total stablecoin market cap on the smart contract network barely bouncing from a range of $91 billion to $92 billion.
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