BitGo’s WBTC holds 65% market share despite custody concerns

BitGo’s Wrapped Bitcoin (CRYPTO:WBTC) has retained over 65% of the tokenised Bitcoin (CRYPTO:BTC) market despite recent criticism over its custody model, according to a report from Binance Research.

WBTC allows Bitcoin to be used on other blockchains like Ethereum (CRYPTO:ETH) and Solana (CRYPTO:SOL), expanding its utility in decentralized finance (DeFi).

The report highlights WBTC's strong performance, with weekly transactions reaching an all-time high of 123,200.

For the first time, WBTC consistently achieved over 100,000 transactions per week, and its supply grew to 152,400 tokens.

These metrics reflect WBTC’s dominance, despite concerns raised by the crypto community.

Criticism stemmed from BitGo’s partnership with Tron (CRYPTO:TRX) founder Justin Sun, which aims to expand WBTC’s jurisdiction to regions like Hong Kong and Singapore.

Community members voiced concerns about Sun’s involvement, fearing it could centralize control.

BitGo’s CEO, Mike Belshe, addressed these concerns, assuring users that Sun would not have the authority to move funds unilaterally.

In response to these concerns, some projects, including MakerDAO (now Sky), proposed removing WBTC as collateral.

Meanwhile, other companies introduced their own wrapped Bitcoin tokens, such as Coinbase’s cbBTC (CRYPTO:CBBC), which quickly became the third-largest wrapped Bitcoin.

Additionally, the Binance Research report discussed Ethereum’s current inflationary trend.

Ethereum, which has promoted itself as having an “ultrasound money” system, saw inflation levels not observed in two years.

A drop in transaction fees following the Dencun upgrade resulted in fewer ETH coins being burned.

Over the past 30 days, ETH’s issuance rate has risen to 0.74%, leading market analysts to suggest that Ethereum is entering an inflationary period.

However, Binance Research noted that Ethereum could return to a deflationary state if network activity on the mainnet increases significantly.

At the time of reporting, the Wrapped Bitcoin price was $63,655.68.