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Term

wrapped token

Definition

A blockchain-based token that represents another cryptocurrency or asset on a different network. For example, Wrapped Ether (WETH) represents ether (ETH) in a format that complies with Ethereum's ERC-20 token standard. The original asset is securely locked by a smart contract, and an equivalent wrapped token is minted. This mechanism enables interoperability within and between blockchains, allowing assets like ETH to be used seamlessly in decentralized applications while retaining their value.
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