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- 1 Minting is the process of creating WBTC tokens
- 2 WBTC token is in an uptrend after the bullish spike of October.
- 3 The current supply zone is strong for the bullish investors as the bears are active.
Bitcoin (BTC) is the reference price of WBTC, an ERC-20 token on the Ethereum network. To provide decentralized apps (dApps) on Ethereum with access to Bitcoin, the currency was introduced in January 2019.
The token is backed one-to-one by Bitcoin. Currently, WBTC is often traded on decentralized exchanges (DEXs) and utilized as security on lending and derivatives websites.
What is the Need for WBTC
DeFis and DApps struggle to access Bitcoin’s value despite its large market cap.
Any financial market that wants to boost liquidity must have access to more value. DeFi is now more resilient as WBTC has unlocked the value of Bitcoin. Furthermore, because more transactions may be processed per second on the Ethereum network.
The process of creating WBTC is called “minting,” which involves submitting the amount of WBTC required along with a fee for minting to a WBTC merchant. Then, the merchant will complete Anti Money Laundering (AML) and Know Your Customer (KYC) on the submitter to ensure that everything checks out.
The custodian will mint the equivalent amount of WBTC after receiving BTC from the merchant. This minting occurs at known addresses that anyone can track. The custodian deposits the BTC at known reserve addresses and sends the newly minted WBTC to the merchant. Upon receiving WBTC, the merchant will send it to the submitter.
Technical Analysis & Prediction of the WBTC Coin Price
The bullish rally of Wrapped Bitcoin (WBTC) ended in August when the bears successfully forced a lower high below the trendline. That led to a consolidation pattern that continued until mid-October.
The BlackRock ETF news caused WBTC to surf the bullish rally, resulting in the coin rising past the major supply zones.
| Pivot | Classic | Fibonacci | Camarilla | Woodie |
| S3 | 27948.880 | 32348.030 | 36430.930 | 31066.090 |
| S2 | 32348.030 | 34028.510 | 36834.190 | 32583.470 |
| S1 | 34994.370 | 35066.710 | 37237.440 | 35465.240 |
| P | 36747.180 | 36747.180 | 36747.180 | 36982.620 |
| R1 | 39393.520 | 38427.660 | 38043.960 | 39864.390 |
| R2 | 41146.330 | 39465.860 | 38447.210 | 41381.770 |
| R3 | 45545.480 | 41146.330 | 38850.470 | 44263.540 |
Currently, Wrapped Bitcoin is trading near its five-day high of $45,000. Its price is favorably positioned between support and resistance. With support being set at around $40,441 and resistance at $44,710.
The token has some room to run before facing resistance. However, it is observed that the resistance is stronger and is causing troubles to the bullish investors.
Conclusion
WBTC is an ERC-20 token on the Ethereum network that references Bitcoin (BTC) price. It is minted by submitting the WBTC required along with a fee to a WBTC merchant. BlackRock ETF news caused WBTC to surge past supply zones, but resistance is causing troubles for bullish investors.
Technical Levels
- Support Levels: $40,441 and $34,472
- Resistance Levels: $44,710 and $50,956
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading in stocks, cryptos or related indexes comes with a risk of financial loss.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
