Wrapped tokens are revolutionizing how digital assets interact across blockchain ecosystems. Coinbase has taken a major step forward by launching cbDOGE and cbXRP—wrapped versions of Dogecoin and XRP—on Base, its Ethereum Layer 2 network. This development marks a pivotal moment in expanding cross-chain utility for two of the most widely recognized cryptocurrencies, opening new doors in decentralized finance (DeFi).
These new assets are ERC-20 tokens fully backed 1:1 by their native counterparts held securely in Coinbase custody. In simple terms, wrapped tokens allow non-Ethereum assets to function seamlessly within Ethereum-compatible environments like Base, enabling broader use in lending protocols, decentralized exchanges (DEXs), yield farming, and more.
👉 Discover how wrapped tokens are reshaping DeFi opportunities across chains.
What Are Wrapped Tokens and Why Do They Matter?
Wrapped tokens act as bridges between isolated blockchain networks. For example, Dogecoin operates on its own blockchain, while XRP runs on the Ripple network—neither natively supports smart contracts or DeFi integrations like those on Ethereum. By "wrapping" them into ERC-20 format, they gain compatibility with Ethereum’s vast ecosystem.
As CoinGecko explains, wrapped tokens solve the critical issue of blockchain interoperability—the inability of different blockchains to communicate directly. With over $46.6 billion in total market capitalization across all wrapped assets, their importance in the crypto economy is undeniable.
Coinbase’s move ensures that DOGE and XRP holders can now participate in DeFi without selling their original holdings. Whether it's providing liquidity on Uniswap, staking in yield-generating protocols, or using them as collateral in lending platforms, cbDOGE and cbXRP unlock real utility.
Base Gains Momentum with Expanded Asset Support
Base, Coinbase’s Layer 2 scaling solution built on Optimism’s OP Stack, has rapidly grown into one of the most active Ethereum L2s. The introduction of cbDOGE and cbXRP strengthens its position by attracting communities around these high-profile tokens.
Current data shows that 2.3 million cbXRP and 10.4 million cbDOGE have already been minted and are circulating on Base. This immediate adoption signals strong user demand for greater asset diversity within the ecosystem.
Dillon Liang, co-founder of DeFi infrastructure firm Blueprint Finance, emphasized the strategic significance:
“These assets now have access to the growing Base ecosystem, meaning they can be used in DeFi apps, traded more easily, and add the potential for further utility in DeFi.”
For developers and users alike, this means richer liquidity pools, more diverse trading pairs, and enhanced financial tools—all contributing to a more robust and resilient decentralized economy.
👉 See how top Layer 2 networks are accelerating DeFi innovation today.
A Strategic Expansion in Coinbase’s Wrapped Asset Lineup
This launch follows the successful rollout of cbBTC, Coinbase’s wrapped Bitcoin token, which now boasts a market cap exceeding $4.7 billion. The platform also plans to introduce cbLTC (wrapped Litecoin) and cbADA (wrapped Cardano) in the near future, indicating a clear strategy to bring major cryptocurrencies into the Ethereum-compatible fold.
Alexander Blume, CEO of Two Prime Digital Assets, likened these wrapped products to Bitcoin ETFs—financial instruments that allow traditional investors to gain exposure to Bitcoin without holding it directly. Similarly, wrapped tokens let native coins operate within modern DeFi rails.
“Clearly, Coinbase is seeing demand from clients for this and so has responded by enabling this functionality,” Blume noted. “For Base, the advantage is that these tokens broaden the customer base and increase usage of the L2 network.”
By offering familiar assets in a usable format, Coinbase lowers the barrier to entry for millions of existing DOGE and XRP holders who may have previously found DeFi too complex or inaccessible.
Ripple and Circle Push Toward Traditional Finance Integration
While Coinbase expands DeFi access through wrapped tokens, other players are working to bridge crypto with traditional finance. Ripple recently filed an application with the U.S. Office of the Comptroller of the Currency (OCC) for a national bank charter. If approved, Ripple would operate under both federal and state oversight—via NYDFS for its RLUSD stablecoin—setting a new benchmark for regulatory compliance.
In parallel, Circle, issuer of the widely adopted USDC stablecoin, has also submitted a national bank charter application to the OCC. These moves signal a growing convergence between legacy financial systems and on-chain economies.
Anchorage Digital remains the only U.S.-based crypto-native institution currently holding an OCC charter, making Ripple and Circle’s applications particularly significant. Their pursuit of formal banking status reflects an industry-wide shift toward legitimacy, transparency, and institutional-grade trust.
FAQ: Your Questions About Wrapped Tokens Answered
What is a wrapped token?
A wrapped token is a cryptocurrency that represents another asset on a different blockchain. It maintains a 1:1 peg with the original asset and is typically backed by reserves held in custody.
How does cbDOGE work?
cbDOGE is an ERC-20 version of Dogecoin issued on Base. Each token is backed by one Dogecoin stored securely by Coinbase, allowing DOGE to be used in Ethereum-based DeFi applications.
Is there a risk with wrapped tokens?
Yes—primary risks include custodial risk (reliance on the entity holding the underlying asset) and smart contract vulnerabilities. However, reputable issuers like Coinbase mitigate these through audits and secure custody solutions.
Can I swap cbXRP back to XRP?
Yes. Users can redeem cbXRP for native XRP through Coinbase’s bridging mechanism, ensuring liquidity and reversibility.
Why use Base for wrapped assets?
Base offers low transaction fees, fast confirmations, and seamless integration with Ethereum tools—making it ideal for DeFi participation.
Are wrapped tokens centralized?
Most are semi-centralized since they rely on custodians like Coinbase to hold reserves. However, they enable decentralized usage of otherwise isolated assets.
Final Thoughts: The Future of Cross-Chain Interoperability
Coinbase’s launch of cbDOGE and cbXRP underscores a broader trend: the fragmentation of blockchain ecosystems is being bridged through innovative financial engineering. As DeFi continues to mature, interoperability, user accessibility, and regulatory clarity will define the next phase of growth.
With Base emerging as a central hub for Ethereum-aligned innovation, and major players like Ripple and Circle aligning with traditional finance frameworks, the lines between digital assets and mainstream finance are blurring faster than ever.
👉 Explore how you can start using wrapped tokens in DeFi today.
Whether you're a long-time DOGE supporter or an XRP investor looking for yield opportunities, the expansion of wrapped assets opens new pathways to engage with your favorite cryptocurrencies—beyond simple speculation and into active financial participation.