Wrapped assets are digital tokens that represent another asset, allowing it to be used on different blockchain networks. The most common example is Wrapped Bitcoin (WBTC), which allows Bitcoin holders to engage in decentralized finance (DeFi) on the Ethereum network.To create a wrapped asset, the original asset is locked in a secure wallet by a custodian. An equivalent amount of the wrapped token is then minted and distributed. For instance, if you wrap one Bitcoin, a corresponding WBTC is created on Ethereum. This process ensures that the value of the wrapped asset remains tied to the original.Wrapped assets facilitate interoperability between blockchains, enabling users to take advantage of various applications and platforms without selling their original assets. They also enhance liquidity, as they allow more traders to access different markets. In summary, wrapped assets bridge the gap between different blockchain networks, enabling greater flexibility and utility.