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Wrapped Tokens

What does Wrapped Tokens mean in crypto terms?

Wrapped Tokens are a type of cryptocurrency token that are issued on a blockchain different from the native blockchain of the asset it represents, and are pegged to the value of that asset. They enable the representation of assets (like Bitcoin) on other blockchains (like Ethereum), allowing for more interoperability between different blockchain platforms. For instance, Wrapped Bitcoin (WBTC) is a wrapped token on the Ethereum blockchain that represents Bitcoin. Wrapped tokens allow for the use of other cryptocurrencies in decentralized finance (DeFi) applications, smart contracts, and decentralized exchanges on blockchains different from the native blockchain of the represented asset.

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