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This year, the number of tokenized bitcoins on alternative blockchains like Ethereum has dropped a lot. Last January, the number of wrapped bitcoin (WBTC) issued on the Ethereum blockchain was around 266,880 WBTC, and since then the number has dropped by more than 15% down to 225,962 WBTC. Similarly, the amount of tokenized bitcoins minted on the Binance Smart Chain (BSC) has dropped quite a bit over the past 11 months as well.
At the time of writing, the two largest tokenized bitcoin (BTC) projects are wrapped bitcoin (WBTC) and BSC-issued Bitcoin BEP2 otherwise known as BTCB. However, the number of tokenized bitcoins originating from both projects has dropped a lot since January.
For example, the number of BTCB in circulation on January 6, 2022 was around 105,121 BTCB, according to archived coinmarketcap.com statistics. Furthermore, BTC was trading at $42.738 per unit that day, meaning BTCB’s market cap was around $4.49 billion.
Since then, BTC’s price has shaken and it is a long way away from the $42K zone. The number of BTCB in circulation has fallen 49.1% to 53,444 BTCB, according to coinmarketcap.com data recorded on November 25.
With an exchange rate of around $16,504 on November 25, the market capitalization of BTCB is approximately $882 million. In the last 24 hours, BTCB has seen $3.25 million in global trading volume on a number of decentralized exchange (dex) platforms. The Dex applications with the most active BTCB trading include Pancakeswap V2, Biswap, Dodo and Apeswap.
The largest tokenized bitcoin project WBTC has much more tokens than BTCB in circulation. On November 25, 2022, data shows that the number of WBTC in circulation is around 225,962 WBTC and on January 14, 2022, it was 266,880 WBTC.
This means that over the course of 2022, the WBTC supply has been reduced by more than 15%, as 40,918 tokens were removed from circulation. Furthermore, over the past 30 days, Dune Analytics data, published by 21shares Research, shows that WBTC’s supply has fallen by 8.72%.
Of course, WBTC’s value was much higher on January 14th, as WBTC’s market cap was around $11.35 billion. Removing over 40,000 WBTC from supply and coupling that with BTC’s price dropping to $16K makes WBTC’s total market capitalization on November 25th much smaller than it was at the beginning of the year.
Today, WBTC’s market capitalization is approximately 3.66 billion nominal US dollars and in the last 24 hours it has seen $346.90 million in trading volume. The most active exchanges that trade WBTC include Binance, Okx, Digifinex and Hitbtc.
Tokenized bitcoin supplies have followed the same path as stablecoin supplies this year, which has shrunk a lot in 2022. The data suggests that during the crypto winter, traders exchange their tokenized stablecoins for real US dollars. With tokenized bitcoin projects like BTCB and WBTC, users who exchange these tokens are looking to get their real bitcoin back.
What do you think about the reduction of tokenized bitcoin supply over the last 11 months? Let us know what you think about this topic in the comments section below.
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