Synthetic BTC Market Shifts Dramatically as cbBTC Surpasses 30K Milestone While wBTC Supply Plummets

The synthetic Bitcoin landscape just flipped on its head—cbBTC surges past 30,000 units while wBTC's supply takes a nosedive.

Supply Shockwaves

cbBTC's explosive growth cuts through market expectations, hitting that psychological 30K barrier that makes traders sweat. Meanwhile, wBTC's declining numbers signal a fundamental shift in how institutions handle wrapped assets.

Traders scramble as the synthetic pegs show unexpected divergence—because nothing says 'healthy market' like two versions of the same asset moving in opposite directions.

This isn't just portfolio rotation—it's a full-scale migration that exposes how fragile synthetic structures become when real yield chasers jump ship. The 'decentralized' finance crowd suddenly remembers that all synthetic assets ultimately rely on someone actually holding the real thing.

TLDR

• cbBTC supply has surpassed 30,500 tokens after recording more than 160% growth year to date.
• Coinbase expanded cbBTC adoption by integrating it into its custody, brokerage, and exchange services.
• cbBTC-backed loans facilitated by Morpho Labs on Base have now exceeded one billion dollars in collateral.
• The supply of wBTC has fallen by 17% since September 2024 and has dropped 4% this year.
• Coinbase delisted wBTC in December 2024 but still allowed withdrawals and limited trading.

Coinbase’s synthetic Bitcoin, cbBTC, has reached a supply of more than 30,500 tokens, marking strong growth since September 2024. The token’s supply has increased over 160% year-to-date, outpacing other synthetic BTC offerings on Ethereum. This rise highlights a notable shift in the dominance of Wrapped Bitcoin products.

cbBTC Surges Past 30K Amid Rising Demand

cbBTC has grown from 1,000 tokens at launch to over 30,500, showing consistent demand from both institutional and retail holders. Coinbase facilitated this growth by using its custody, brokerage, and exchange rails to simplify conversions into cbBTC. Consequently, institutions and treasuries integrated CBBTC into their balance sheets with fewer operational barriers.

The token’s adoption expanded further when Persistence DEX V2 integrated cbBTC for cross-chain swaps on June 25. The new feature enabled swaps between Base and BNB Chain with a minimum entry of $10 cbBTC. However, the unaudited status of the beta system has temporarily slowed broader participation in the ecosystem.

Coinbase confirmed on July 15 that cbBTC-backed loans surpassed $1 billion in collateral, supported through Morpho Labs on Base. The loans demonstrate increasing confidence in cbBTC’s stability as a collateralized asset. The growing collateral base also highlights a rising preference for Coinbase’s wrapped Bitcoin compared to alternatives.

Justin Sun Involvement Sparks wBTC Market Shift

While cbBTC expanded, the largest synthetic BTC on Ethereum, wBTC, reported a 17% supply drop since September 2024. On-chain data also revealed a 4% decline in WBTC year-to-date, showing waning demand. The decline followed governance changes involving Justin Sun, which drew concerns among some industry participants.

BitGo CEO Mike Belshe confirmed Sun’s involvement in managing wBTC, but emphasized the company’s focus on continued security. Sun also clarified that he held no access to the private keys securing wBTC reserves. Nevertheless, market participants shifted preferences, and cbBTC began capturing increasing shares of synthetic bitcoin activity.

Coinbase delisted wBTC from its exchange on December 19, 2024, citing listing standard reviews. The company moved order books to limit-only mode and allowed withdrawals. BiT Global, a Sun-backed firm, challenged the decision legally but later withdrew the lawsuit with prejudice.

Coinbase Plans Proof of Reserves for cbBTC

Overall synthetic BTC supply on ethereum rose only 3% since September 2024 despite cbBTC’s surge. This limited overall growth indicates cbBTC expanded largely at wBTC’s expense. Consequently, substitution flows significantly fueled cbBTC’s upward trajectory.

Coinbase also announced plans to introduce proof of reserves for cbBTC to verify its one-to-one BTC backing. The platform stated this initiative during the token’s launch, reinforcing transparency for its users. This measure aims to strengthen confidence as adoption expands across Ethereum and beyond.

Future plans include extending cbBTC’s utility to Solana, leveraging its low-cost and high-speed infrastructure. Coinbase intends to support broader lending and swap services across multiple chains. Thus, cbBTC is positioned to become a central player in cross-chain Bitcoin finance.