Ether is the native coin of Ethereum, but it predates the token standard most apps expect. Wrapped ether (WETH) solves that: lock ETH in a contract, receive the same amount of WETH, which behaves like any other token. Unwrap it and you get your ETH back.
The same trick carries assets between networks - wrapped bitcoin brings BTC's value onto Ethereum, for example. Useful, but read the label. A wrapped token is only as good as whatever holds the original: a smart contract, a custodian or a bridge. The asset may be familiar; the thing guaranteeing it is new, and that is where the risk sits.
💬 Have you used a wrapped token? Did you check what was backing it?
Binance Academy covers this in more depth: https://www.binance.com/en/academy/glossary/wrapped-ether
Next lesson: Store of value vs everyday money
Trading crypto from Dubai since 2019.
#WrappedTokens #Ethereum #DeFi