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WETH vs ETH

Cryptocurrencies are great, but they’re also wildly confusing. Ethereum, the native token of the Ethereum blockchain, has been around for quite some time now. In fact, it’s so old that the ERC-20 standard was actually issued after the ETH token. 

This sets up a problem as to make a transaction compatible across several ERC-20 compatible blockchains and Ethereum; you’d have to write the functionality for Ethereum separately. This is where WETH comes in to save the day. 

In this article, we’re looking at WETH and comparing it against its unwrapped counterpart to see the difference between the two. 

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What is WETH?

WETH is simply a wrapped version of the ETH token that supports the ERC-20 standard. WETH was created because ETH isn’t compatible and is not feasible to be used for DeFi applications. 

ERC20 is a standard for issuing tokens on the Ethereum blockchain. However, it only dictates the properties of a token and is fungible, meaning tokens have the same value and can be exchanged among each other without much hassle. 

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Since ETH was launched before token standards were created, it isn’t easy to use with dApps and requires a third party to process tokens. By wrapping the ETH token in an ERC-20 compatible standard, we can use it across several different DeFi applications. Additionally, this also means that users can create their own token versions for their custom DeFi applications as well. 

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Is ETH different from WETH?

Yes and no. The only discernable difference between the two is the fact that the latter is a wrapped version of Ethereum, which allows for interoperability between tokens and follows a standard that is more useful for exchange listings and makes it easier to transfer tokens from one user to another. 

There’s no real difference between the two, not even their price. If you want to be included in a custom dApp, all you have to do is convert your existing ETH into WETH and use it as normal. 

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