How does wrapped eth compare to eth in terms of value and usage in the digital currency market?

1 answers

• Leon ebahDec 25, 2022 · 3 years ago
  Wrapped eth (WETH) is an ERC-20 token that represents ether (ETH) on the Ethereum blockchain. It is commonly used to enable the trading of ETH on decentralized exchanges and to interact with decentralized finance (DeFi) applications. In terms of value, WETH and ETH should have a 1:1 ratio, as each WETH token is backed by an equivalent amount of ETH. However, due to market forces and liquidity, the prices of WETH and ETH may slightly deviate. In terms of usage, WETH is primarily used as a bridge between ETH and other ERC-20 tokens in the DeFi ecosystem. It allows users to easily swap ETH for other tokens and participate in various DeFi activities such as lending, borrowing, and yield farming. Overall, WETH enhances the liquidity and usability of ETH in the digital currency market.
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