- Circle plans to launch cirBTC, a 1:1 BTC-backed token for DeFi and institutions.
- cirBTC aims to unlock $1.7T BTC for DeFi lending, trading, and borrowing.
- cirBTC enters the $14B market, led by WBTC and cbBTC, with a 208K BTC supply.
Circle is moving beyond stablecoins with a new product aimed at unlocking Bitcoin liquidity. The firm plans to launch cirBTC, a wrapped Bitcoin token backed 1:1 by native BTC reserves.
The stablecoin company wants to bring Bitcoin into DeFi and institutional trading flows as BTC remains largely unused in decentralized finance.
cirBTC Targets Idle Bitcoin Liquidity
Over $1.7 trillion worth of BTC sits outside DeFi due to trust and custody concerns. cirBTC is designed to change that. Each token is fully backed by real Bitcoin, with reserves verifiable on-chain in real time.
The structure allows users to deploy BTC across lending, borrowing, and trading platforms without leaving crypto markets.
Circle is targeting institutional users, including OTC desks, market makers, and lending protocols. The token will launch first on Ethereum and Circle’s Arc blockchain, with direct integration into USDC and Circle Mint.
This creates a ready pipeline for liquidity. The product is termed as a neutral and secure alternative, addressing concerns around existing wrapped BTC models.
Competing in a $14 Billion Market
cirBTC enters an established market dominated by BitGo’s WBTC and Coinbase’s cbBTC. WBTC currently holds a market cap of nearly $8 billion. cbBTC follows with around $6 billion.
Combined supply across both products stands near 208,000 BTC. Despite this scale, both products have faced criticism. Concerns around custody, transparency, and counterparty risk have limited broader adoption.
Circle is using its regulated infrastructure and reserve model, similar to USDC, for cirBTC. However, the core issue is trust in the wrapper. Institutions want Bitcoin exposure with clear reserves and minimal counterparty risk.
Circle claims cirBTC to be fully auditable and compliant, leveraging its existing licensing framework across multiple jurisdictions. The product removes reliance on opaque custodians and aims to provide consistent issuance and redemption.
The token is expected to support cross-chain movement and integrate with multiple financial applications. No launch date has been confirmed yet. Access will depend on regulatory approvals.
Related: Circle Ventures Leads Tazapay Funding, Total Raised Hits $36M
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.