Crypto platform Coinbase has announced the launch of a new asset called Coinbase Wrapped Staked ETH (cbETH) ahead of the upcoming Ethereum Merge. This token will be listed on the Ethereum network as an ERC-20 token.
cbETH will allow customers to use their staked Ether while earning rewards on the exchange. These tokens will be available for trading from August 25 “if liquidity conditions are met.”
Customers can withdraw tokens to Coinbase, stake them, and then wrap the ETH2 into cbETH, with the new wrapped staked token balance visible on their accounts.
According to the token’s whitepaper, the platform hopes that this new token will be adopted for use in trade, transfer, and DeFi applications.
Coinbase says that cbETH will essentially function as a compound token, given that they are “most widely compatible with dApps in DeFi today, due to the fact that they are ERC-20 compliant.”
“With cbETH, Coinbase aims to contribute to the broader crypto ecosystem through creating high-utility wrapped tokens and open sourcing smart contracts,” says the platform.
Once sufficient supply of this asset is established, trading of cbETH-USD trading pair will begin in phases.
The platform clarified that the price of cbETH does not track the price of ETH 1:1. Since the initialization of the conversion rate and balance of cbETH on June 16th, 2022, all staked ETH as well as its accrued staking interest is represented by cbETH.
The Ethereum Merge is scheduled to begin on September 6. The Ethereum Foundation announced that the merge transition will be fully completed between September 10 and 20.
