21.co, the parent company of cryptocurrency asset manager 21Shares, announced on September 3rd the launch of its own Bitcoin wrapper, 21.co Wrapped Bitcoin (21BTC), on the Ethereum blockchain network. This new offering is part of 21.co’s broader strategy to expand its presence in the cryptocurrency wrapping space.
The introduction of 21BTC adds to 21.co’s growing portfolio of wrapped tokens on Ethereum, which already includes tokens such as wrapped Avalanche, Polkadot, and Solana. This move follows the successful launch of 21BTC on the Solana blockchain in May, highlighting the company’s ongoing efforts to diversify its blockchain technology offerings and enhance asset liquidity across various platforms.
Enhanced Asset Management and Security Features
Eliézer Ndinga, 21.co’s head of strategy and business development for digital assets, emphasized that the BTC wrapper is designed to integrate stringent asset management best practices into the realm of wrapped assets. This includes the use of institutional-grade custodians and advanced security protocols. The company has implemented robust user protection measures, including cold storage solutions and regulated third-party custodians, to ensure the safety and integrity of the wrapped assets.
21.co has partnered with Flow Trader, a prominent market maker, to manage the issuance and oversight of 21BTC. Wrapped Bitcoin tokens like 21BTC are ERC-20 tokens backed by actual Bitcoin, providing a bridge between Bitcoin and the Ethereum ecosystem.
The launch of 21.co’s wrapped Bitcoin comes at a time when the most popular BTC wrapper, Wrapped Bitcoin (wBTC), faces significant scrutiny. Recent concerns have been raised about wBTC’s custodian, BitGo, and its controversial partnership with BiT Global, which could affect the custody of wBTC’s Bitcoin backing. This partnership has been criticized, particularly due to the involvement of controversial figures like Justin Sun, raising fears of potential misappropriation of collateral.
Subsidiaries and Product Offerings
21.co is widely recognized for its subsidiary, 21Shares, which issues various cryptocurrency exchange-traded funds (ETFs), including the ARK 21Shares Bitcoin ETF (ARKB) and the 21Shares Core Ethereum ETF (CETH). These products demonstrate 21.co’s commitment to providing diversified investment opportunities in the cryptocurrency sector.
Michael Lie, Flow Trader’s global head of digital assets, explained that wrapped BTC acts as a critical source of collateral that enables a wide range of financial activities in the crypto space, such as lending, borrowing, and trading. The launch of 21.co’s wrapped BTC aims to bring enhanced liquidity and interoperability across multiple blockchain networks, facilitating smoother transitions and interactions between different cryptocurrencies.
| Feature | Description |
|---|---|
| Blockchain Integration | Launched on Ethereum and Solana networks |
| Asset Backing | Each token is backed by actual Bitcoin |
| Security Measures | Utilizes cold storage and regulated custodians |
| Issuance Management | Managed by Flow Trader |
| Market Cap Potential | Aims to compete with leading wrappers like wBTC |
21.co’s launch of a Bitcoin wrapper on the Ethereum blockchain represents a strategic expansion in its digital asset offerings, designed to enhance the interoperability and functionality of cryptocurrencies across different blockchain environments. By incorporating rigorous asset management practices and focusing on security, 21.co aims to attract a broad range of investors and users, seeking to capitalize on the growing demand for sophisticated crypto-financial products.
As the cryptocurrency landscape continues to evolve, 21.co’s initiatives like the wrapped Bitcoin are set to play a pivotal role in shaping the future dynamics of blockchain interoperability and investment practices.
Featured image credit: Tanatpon Chaweewat via Vecteezy
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