Wrapped Ether (WETH) is an ERC-20 token pegged 1:1 to ETH, created by locking ETH in a smart contract and redeemable at any time at the same ratio.
WETH is widely used across decentralized exchanges, lending protocols, and liquidity pools on Ethereum and major Layer 2 networks including Base, Arbitrum, and Optimism.
ERC-7528 (finalized 2023) introduced a standard address convention for representing native ETH in ERC-20 contexts, reducing the need to wrap ETH in certain protocol integrations.
Ether is the native currency of the Ethereum blockchain and was created before the ERC-20 token standard was implemented. As a result, ETH is not natively ERC-20 compatible and cannot be exchanged directly for other ERC-20 tokens in a decentralized manner without additional technical complexity.
Rather than building two separate interfaces into every smart contract, one for ETH and one for ERC-20 tokens, developers created WETH as a solution. By "wrapping" ETH into an ERC-20 token, applications can handle ETH and other ERC-20 tokens under the same technical standard, reducing complexity and eliminating reliance on trusted third parties.
To wrap ETH, a user sends ETH to the WETH smart contract. The contract holds the ETH and issues an equivalent amount of WETH tokens (1 ETH = 1 WETH). To unwrap, the user sends WETH back to the same contract and receives the original ETH at the same 1:1 ratio. No fees are charged by the contract itself, though standard Ethereum gas fees apply to both transactions.
A separate Ethereum standard, ERC-7528 (finalized in 2023), introduced a standard placeholder address for representing native ETH in ERC-20 contexts. This convention allows certain protocols, such as ERC-4626 vaults and DEX routers, to reference native ETH without requiring it to be wrapped first. ERC-7528 does not replace WETH; both standards coexist, with WETH remaining the standard for contexts that require a fully transferable ERC-20 token.
ETH is the native currency of Ethereum and is not ERC-20 compatible. WETH is an ERC-20 token that represents ETH at a 1:1 ratio, enabling it to be used in DeFi protocols that require the ERC-20 standard. ETH can be converted to WETH and back at any time without a fee beyond gas costs.
Yes. WETH maintains a 1:1 peg with ETH through the wrapping smart contract mechanism. One WETH can always be redeemed for one ETH, and one ETH can always be used to mint one WETH. The peg is enforced by the contract, not by market forces.
The WETH9 contract deployed on Ethereum mainnet is one of the most audited and battle-tested contracts in the ecosystem. As with any smart contract interaction, users should verify they are interacting with the correct contract address and exercise caution on unfamiliar platforms or L2 networks where different WETH contracts may be deployed.