Wrapped refers to a process where a cryptocurrency is encapsulated in a smart contract to enable it to function on a different blockchain. This is commonly used to allow interoperability between different networks.For instance, Bitcoin can be wrapped as WBTC (Wrapped Bitcoin) so it can be used on the Ethereum network. The original Bitcoin is held in reserve while WBTC tokens are issued on Ethereum. These wrapped tokens maintain a 1:1 peg to the original asset, meaning each WBTC corresponds to one Bitcoin.Wrapping makes it easier to use various coins in decentralized finance (DeFi) applications, allowing users to trade, lend, or stake their wrapped assets without needing to convert them back to the original currency. This enhances liquidity and expands the utility of assets across different platforms and ecosystems. The wrapping process is secure, as it involves verified custodians and smart contracts that manage the creation and redemption of wrapped tokens, ensuring transparency and trust in the system.