Where Can You Get Solana’s Best $cbBTC Yield?

Coinbase, one of the industry’s most popular crypto exchanges, has finally brought its proprietary Bitcoin asset to Solana.

Prominent Solana DeFi players have supported the $cbBTC migration, launching a variety of incentivized rewards campaigns to spearhead adoption of the asset within the Solana ecosystem.

Why is $cbBTC useful, and where can DeFi users get the best yield on $cbBTC?

Coinbase Launches $cbBTC on Solana

After originally launching $cbBTC on Ethereum and Base earlier this year, Coinbase has migrated the asset to the Solana ecosystem. Backed by Bitcoin on a 1:1 basis, $cbBTC is designed to make Bitcoin a more composable and versatile asset by making it compatible with DeFi applications.

For all its ingenuity, BTC is poorly designed for DeFi. Unlike Layer-1 blockchains like Solana, the Bitcoin Network doesn’t support smart contracts, meaning that Bitcoin has limited utility outside being a store of value and currency of exchange. Despite progress being made in BitcoinFi, networks like Solana are still far more capable of sophisticated DeFi integrations.

Within 24 hours of launch, over $10M worth of $cbBTC has been minted on the Solana network. Based on Solscan data, $cbBTC’s circulating supply on the Solana sits at approximately 135 tokens, spread across 415 holders.

How to Use $cbBTC in Solana DeFi

Supporting the launch of $cbBTC on the network, several Solana DeFi projects have unveiled generous reward campaigns. Similar to the incentivized yield that drove $PYUSD to a market capitalization of over $600M, these rewards encourage users to leverage $cbBTC in their DeFi strategies and promote further adoption of the asset.

Kamino Finance, Raydium, and Jito have collaborated to provide users with what is arguably the best $cbBTC yield generation pool on Solana. In a bid to bring deeper onchain liquidity to $cbBTC, the partnership has promised to distribute $20,000 worth of rewards paid in $RAY and $JTO to $cbBTC/$JitoSOL vault depositors. At press time, the vault has attracted over $1.6M in TVL, offering ~27% APY on deposited funds.

Save Finance, one of Solana’s original lending markets, has promised to distribute $10,000 worth of rewards to $cbBTC liquidity providers over the next two weeks. 

Meanwhile, the Orca decentralized exchange has committed an unspecified amount of $ORCA rewards.

$cbBTC at 10% of $wBTC Marketshare Within 57 Days of Launch

Boasting a market capitalization of over $11B and available on dozens of blockchain networks, Wrapped Bitcoin is undoubtedly the industry’s leading Bitcoin-backed asset. However, $WBTC has recently come under scrutiny and mistrust given it’s recent association with Tron co-founder Justin Sun, who many industry participants deem untrustworthy.

Perhaps due to Coinbase’s solid reputation for regulatory adherence, DeFi users appear to be slowly transitioning towards $cbBTC and moving away from $WBTC. 

According to Dune Analytics, $cbBTC is steadily siphoning market share away from $WBTC. On October 1st, 2024, data indicates that $cbBTC has a circulating supply of 5,530 tokens, representing a mere 3.62% of $WBTC’s supply at 152,380.

Today, $cbBTC market share against $WBTC has increased to 9.35%, with a supply of 13,725 tokens against $wBTC’s 146,742. 

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