Circle, the stablecoin issuer, revealed that it is launching its own wrapped Bitcoin token, cirBTC, which puts it in competition with rivals BitGo and Coinbase. Moreover, the move is most likely aimed at the institutional DeFi market.
Circle enters the wrapped Bitcoin race
Announced by Circle on Thursday on X the asset will be backed 1:1 by native Bitcoin and designed for over-the-counter desks, market makers, lending protocols, and derivatives platforms. Circle regards it as a “highly secure and neutral version of wrapped BTC” with reserves on-chain, independently verifiable in real-time.
The Ethereum mainnet will be the first to introduce cirBTC, which will be supported by Circle’s layer-1 blockchain Arc. According to a statement, it will also work with Circle Mint, the company’s stablecoin issuance platform, and with USDC, which will give institutional users a single Circle-native stack.
The project has no launch date announced yet and is listed as “coming soon” on circle.com/cirbtc. The availability is subject to regulatory approvals.
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The trust problem cirBTC is built to solve
Circle’s VP of Product, Rachel Mayer (@0xrachelita), expressed on X that $1.7T of bitcoin is sitting on the sidelines of DeFi. Not because people don’t want yield or liquidity, but it’s because they don’t trust the wrapper. cirBTC is Circle’s answer: 1:1 backed, on-chain verifiable, and built on infrastructure the market already trusts.”
Co-founder and CEO Jeremy Allaire of Circle echoed the sentiment on X that the “infrastructure that supports USDC, EURC, and USYC is being brought by the firm to the largest digital asset, creating a neutral infrastructure for new applications for on-chain BTC.”
Joining a market led by WBTC and cbBTC: defined by controversy
cirBTC enters a market currently led by BitGo’s Wrapped Bitcoin (WBTC), which carries a market capitalization of approximately $8 billion with around 119,157 tokens in circulation. Coinbase Wrapped Bitcoin (cbBTC), launched in September 2024, has grown to a $5.9 billion market cap. Together, the two tokens account for roughly 208,000 BTC in combined supply, according to CoinGecko.
The wrapped Bitcoin market has not been free of controversy. In August of 2024, BitGo, the custodian of Wrapped Bitcoin (WBTC), revealed a partnership with BiT Global. BiT Global, it should be noted, has ties to Justin Sun, the founder of Tron. The move alarmed major DeFi protocols; MakerDAO and Aave both moved to limit WBTC exposure as collateral. Coinbase subsequently delisted WBTC, stating it did so due to the “unacceptable risk” posed by Sun’s association with the token, and launched cbBTC as a competing alternative. A lawsuit from BiT Global alleging anti-competitive conduct was eventually dropped. Circle is now stepping into the gap that the controversy created.
Circle’s broader pivot beyond stablecoins
cirBTC marks Circle’s first significant product expansion beyond stablecoins since the company went public on the NYSE under the ticker CRCL. Shares closed down 0.53% on Thursday, trading around $90.26, roughly 40% below their six-month high. The token will sit alongside USYC, Circle’s tokenized money market fund, as one of its few non-stablecoin products.
The launch fits Circle’s stated 2026 strategy of building what it calls the “internet financial system,” an interconnected stack of stablecoins, payment rails, blockchain infrastructure, and developer tooling. cirBTC extends that logic to Bitcoin for the first time.
Industry implications
The entry of Circle puts existing wrapped Bitcoin issuers in a competitive bind just as institutional trust in the sector remains shaky. For DeFi protocols that scaled back their WBTC exposure after the 2024 scandal, a regulated, compliance-native alternative from a publicly traded company could be on the cards. The fate of cirBTC, launched by the Celo team to challenge competitors at scale, will depend significantly on how quickly it is deployed and adopted across protocols with real liquidity, such as Aave and Compound. These lending protocols are known to offer a wide array of collateral choices.
