WETH Explained: What It Is, How It Works, and Why It Matters in Crypto

When you hear WETH, Wrapped Ether is Ethereum converted into an ERC-20 token so it can be used in decentralized finance apps. Also known as Wrapped Ether, it’s not a new coin—it’s just Ethereum dressed up to fit into DeFi smart contracts that only accept ERC-20 tokens. You can’t send ETH directly to most DeFi protocols like Uniswap or Aave because they’re built for tokens, not the native blockchain currency. WETH fixes that. It’s a 1:1 representation of ETH, fully backed, fully redeemable, and trusted across the ecosystem.

WETH doesn’t change the value of your ETH. It just makes it compatible. Think of it like converting a dollar bill into a gift card for a specific store—you still have the same value, but now you can use it where cash isn’t accepted. That’s why WETH is everywhere in DeFi: lending, liquidity pools, yield farming, and cross-chain bridges all rely on it. Without WETH, you’d be stuck holding ETH while everyone else is earning interest or trading tokens on platforms built for ERC-20s.

Related to WETH are the tools and systems that make it useful. Ethereum, the blockchain that powers ETH and most major DeFi apps is the foundation. ERC-20, the technical standard that defines how tokens behave on Ethereum is what lets WETH work with wallets, exchanges, and protocols. And DeFi, the open financial system built on blockchain is where WETH shines—enabling users to lend, borrow, and trade without banks.

Some people think WETH is a scam because it’s not a new asset. But it’s not meant to be. It’s infrastructure. Just like USB-C adapters let you plug older devices into new ports, WETH lets ETH plug into the DeFi world. You wrap ETH to use it, then unwrap it to get your ETH back—no loss, no risk, just convenience.

And that’s why you’ll find posts here about WETH’s role in real-world crypto activity: how it’s used in liquidity pools, how it interacts with restaking protocols like EigenLayer, and why some exchanges list it alongside ETH. You’ll also see how fake tokens like Wrapped USDR confuse people—making it clear why knowing the difference between real wrapped assets and scams matters. This isn’t theory. It’s daily practice for millions trading, staking, and earning on Ethereum.

What you’ll find below isn’t hype. It’s real analysis—on exchanges that support WETH, on how DeFi users actually use it, and on the risks of wrapping and unwrapping at the wrong time. No fluff. Just what works, what doesn’t, and why WETH remains one of the most quietly essential pieces of crypto infrastructure today.