WBTC supply contracts this month following Justin Sun custody drama

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—by Protos Staff

Wrapped Bitcoin (WBTC), a popular ERC-20 wrapped version of bitcoin that also has versions on other chains, has seen its supply contract slightly since Justin Sun’s involvement was announced.

A Dune analytics dashboard created by 21.co that tracks the supply of WBTC on Ethereum suggests that the supply of WBTC on Ethereum has contracted by 3.7% over the last month.

The largest burns in the last month seem to have come from Coinlist, FalconX, and Abra.

Dune analytics dashboard, courtesy of 21.co.

Justin Sun’s role

WBTC has attracted significantly greater attention since it announced that it would be transitioning the custody of bitcoin for the token from BitGo to a joint venture between BitGo, BiT Global, and Sun.

BiT Global directors include Yiying Jiang, an executive who has previously worked with Sun on ventures related to BitTorrent, Poloniex, Huobi, TRON, and TrueUSD.

This decision initially led MakerDAO to limit the ability for new Dai, its native token, to be issued by borrowing against WBTC, though this decision was subsequently reversed. 

Read more: Launch of cbBTC, WBTC competitor, sparks Justin Sun hypocrisy

New competitors

Other firms have taken advantage of this stumble to promote alternative products or changes to existing products.

Threshold Network, which is behind tBTC, at one point, proposed a merger with WBTC — something that was unlikely to ever occur. 

Coinbase launched Coinbase Wrapped BTC (cbBTC), a coin that attracted the ire of Sun for its lack of proof of reserves.

Kraken has taken the opportunity to launch its own wrapped Bitcoin token, kBTC, however, none of these tokens have yet seen significant adoption compared to WBTC.

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