Coinbase has launched cbADA and cbLTC on its Ethereum Layer-2 network, Base. This marks the completion of a significant expansion of its wrapped token suite. By allowing Cardano and Litecoin owners to participate in DeFi, yield farming, and decentralized trade without having to sell their native assets, the action represents a significant advancement in cross-chain interoperability.
This deployment comes after previous releases of well-known products. These include cbBTC and cbETH, as well as wrapped Dogecoin (cbDOGE) and XRP (cbXRP). These developments solidify Base’s position as a top Layer-2 for cross-chain DeFi, since Coinbase now provides ERC-20 gateways for six of the top ten non-stablecoins by market capitalization.
Due to technical incompatibilities, holders of Cardano (ADA) and Litecoin (LTC) have been unable to access the rapidly expanding Ethereum-based decentralized finance (DeFi) ecosystem for years. Now that cbADA and cbLTC—ERC-20 tokens, completely backed 1:1 by ADA and LTC, stored in Coinbase custody, are available, users may easily transfer their assets into Base and access a flourishing decentralized finance ecosystem.
How Coinbase Wrapped Tokens Operate
The underlying ADA or LTC has separate cold wallets under Coinbase’s management. It is strictly pegged to each cbADA and cbLTC, coined or burned on demand. Coinbase receives the ADA or LTC that users deposit, and then distributes the corresponding quantity of wrapped tokens on Base. The procedure reverses when users want to redeem; the native asset returns to the user after burning cbADA or cbLTC.
Coinbase regularly publishes on-chain addresses and quarterly attestations to verify that each CB-token is fully backed by actual assets, thereby increasing trust. The goal of this transparency is to inspire trust in both institutional and retail users.
As DeFi companies vie for additional funding from the Cardano and Litecoin communities, the launch of cbADA and cbLTC is expected to lead to a surge in new liquidity-mining and yield activities on Base. Coinbase has removed conversion fees to seed supplies and promote usage during the initial launch period. The custody unit of the business will keep handling redemptions and keep an eye on collateral balances in real time.
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