What Is a “Wrapper” Token and How Does It Relate to Composability?
A wrapper token is an ERC-20 token that represents an underlying asset that may not natively be ERC-20 compliant (e.g. Bitcoin or an NFT).
The wrapper token is created by locking the original asset in a smart contract. This makes the non-ERC-20 asset compatible with the vast ecosystem of DeFi protocols, enhancing composability by allowing it to be traded, lent, or used as collateral.
