The post Why Wrapped Bitcoin on AAVE surged past $2B, explained appeared on BitcoinEthereumNews.com.

contributor Posted: September 28, 2024 Wrapped Bitcoin dominates the DeFi ecosystem with a strong foothold.  Per AMBCrypto, AAVE has strategically maximized its benefits from the rising WBTC exposure. Wrapped Bitcoin [WBTC] remains the dominant Bitcoin derivative in DeFi, commanding over $9 billion in TVL. In fact, WBTC supplied on AAVE has reached a record high, surpassing $2B. This surge reflects the broader trend in DeFi, where bullish Bitcoin sentiment fuels increased WBTC activity. Benefits of Wrapped Bitcoin Interestingly, developers created WBTC to bridge the gap between Bitcoin and Ethereum, allowing users to leverage the benefits of both networks. However, AAVE, a Layer 2 DeFi platform on the Ethereum blockchain, has reaped the most benefits, holding 37,000 WBTC valued at over $2B.  In essence, Wrapped Bitcoin remains a favored choice among investors. Additionally, factors like increased liquidity and the desire for BTC exposure in DeFi might have contributed to this surge. Source : Dune Given AAVE is a lending platform, the 40.4% dominance of WBTC in the lending sector justifies the record supply of Wrapped Bitcoin on the platform.Here, investors can earn interest, enabling Bitcoin holders to maximize returns on their assets without selling their BTC, while also retaining direct exposure to Bitcoin when it tests key resistance levels. Simply put, as Bitcoin’s value rises, the collateral amount in WBTC can also increase, further encouraging its use on platforms like AAVE. Additionally,  THIS is attracting WBTCs on AAVE As mentioned earlier, WBTC can be used in yield farming, where users stake their assets in DeFi platforms to earn additional rewards. This incentivizes users to convert their Bitcoin into WBTC. Per AMBCrypto, AAVE has strategically embraced factors that attract Wrapped Bitcoin holders to its platform. Interestingly, a year ago, the yield earned on WBTC deposits was 0.000489%, which has surged to 0.0747%…

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Filed under: News - @ September 28, 2024 4:11 am