Bitcoin News Today: DeFi Trust Shifts: Centralized WBTC Custodians Face Decentralized Challenge

WBTC, the tokenized version of Bitcoin on the Ethereum blockchain, has recently depegged to $111,000, trading at a $2,000 discount to Bitcoin's current price of $113,000 What are the risks of wbtc?^[1]. This divergence has raised concerns among investors and DeFi participants, as it highlights vulnerabilities in WBTC's custodial model and broader market dynamics. The depegging follows a decline in WBTC's circulating supply, which has fallen to its lowest level since 2021 due to burns outpacing mints wBTC Supply Decline: What It Means for DeFi and the Rise of …^[2]. This trend reflects shifting preferences in the DeFi ecosystem, where alternative wrapped Bitcoin solutions like Coinbase's cbBTC are gaining traction wBTC Supply Decline: What It Means for DeFi and the Rise of …^[2].

The custodial arrangement for WBTC, managed by BitGo, has faced scrutiny after the firm announced a governance shift involving TRON founder Justin Sun's entity, BiT Global. Critics argue this change undermines trust in WBTC's decentralization, given Sun's history with depegged assets like HBTC and USDD Wrapped Bitcoin (WBTC) Price Prediction for 2025, 2026-2030 …^[5]. In response, DeFi platforms such as Aave and MakerDAO have initiated offboarding efforts, reducing WBTC's role as collateral in lending and borrowing protocols Wrapped Bitcoin (WBTC) Price Prediction for 2025, 2026-2030 …^[5]. This shift underscores growing skepticism toward centralized custodians and a preference for alternatives with transparent governance.

The rise of cbBTC, a competing tokenized Bitcoin solution backed by Coinbase, has further intensified competition. cbBTC's rapid adoption-56% of its supply is now on Aave-has positioned it as a viable alternative, though its lack of publicly disclosed reserve addresses has raised transparency concerns wBTC Supply Decline: What It Means for DeFi and the Rise of …^[2]. Meanwhile, decentralized alternatives like tBTC, operated by the Threshold Network DAO, are gaining attention as a trustless solution to WBTC's centralization risks Wrapped Bitcoin (WBTC) Price Prediction for 2025, 2026-2030 …^[5]. tBTC's fully decentralized minting and redemption process contrasts with WBTC's reliance on a limited set of custodians Wrapped Bitcoin (WBTC) Price Prediction 2025^[6].

Price forecasts for WBTC remain mixed. Analysts at Traders Union predict WBTC could reach $136,918.55 by year-end 2025 and $220,848.42 by 2029, aligning with broader Bitcoin price expectations . However, bearish scenarios suggest WBTC could stagnate around $30,000–$50,000 if Bitcoin faces regulatory or macroeconomic headwinds . The current discount to Bitcoin also reflects liquidity imbalances and DeFi-specific demand fluctuations Wrapped Bitcoin (WBTC) Price Prediction 2025^[6].

The depegging event has reignited debates about the risks of centralized custodians in tokenized assets. WBTC's governance structure, while hybrid, remains reliant on BitGo for security and compliance. This centralization has led to calls for decentralized custody models, as seen in tBTC's design, which distributes control across multiple nodes What is wrapped BTC (WBTC)? A short explanation^[4]. For now, WBTC's dominance in the wrapped Bitcoin market (96.6% share) persists, but its market share is under pressure from both decentralized and institutional alternatives wBTC Supply Decline: What It Means for DeFi and the Rise of …^[2].