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What is Wrapped Ether?
Crypto Glossary Definition
Wrapped Ether (WETH) is an ERC-20 token backed by Ethereum. Since Ethereum existed before the ERC-20 standard, it is not natively compatible as a token, and a smart contract must be used to achieve this. Wrapped Ether allows ETH to be directly exchanged for an ERC-20 token without a trusted third party.
Why Wrapped Ether Matters
Wrapped Ether (WETH) is an ERC-20-compatible version of ETH, needed because many DeFi smart contracts are built to expect ERC-20 tokens and can't directly interact with native ETH — wrapping and unwrapping between ETH and WETH is a 1:1, no-loss conversion.
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