On October 17, Kraken introduced Kraken Wrapped Bitcoin (kBTC), a new ERC-20 token aimed at increasing Bitcoin’s utility across decentralized applications (dApps) on networks such as Ethereum and OP Mainnet. Each kBTC token is backed 1:1 by Bitcoin and held in custody at Kraken, allowing users to engage with Bitcoin’s value within the decentralized finance (DeFi) ecosystem while retaining transparency through on-chain verification of reserves.
Kraken positions kBTC as a solution to bring Bitcoin’s store of value and security features into broader blockchain ecosystems, particularly those operating on Ethereum and beyond. Each kBTC token is securely held at Kraken Financial, a Wyoming-chartered Special Purpose Depository Institution (SPDI). The kBTC smart contract has undergone an audit by the security firm Trail of Bits.
Kraken notes that kBTC offers interoperability, allowing Bitcoin to be used across different networks. The token is designed to initially integrate with Ethereum and OP Mainnet, with plans for further expansion to non-EVM chains in the future. Kraken says this increased flexibility makes kBTC a valuable tool for developers seeking to build dApps using Bitcoin or for investors looking to access Bitcoin in on-chain environments.
The exchange allows users to independently verify that each kBTC token is fully backed by Bitcoin by inspecting Kraken’s on-chain reserves.
Kraken’s launch of kBTC also includes partnerships with several platforms from Day 1, including deBridge, Definitive, Gauntlet, ParaSwap, and Yearn, which will incorporate kBTC into their services. These partnerships are expected to help expand kBTC’s reach and utility across DeFi ecosystems.
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