# Wrapped AVAX (WAVAX) > Wrapped AVAX (WAVAX) is a tokenized version of AVAX, operating on a 1:1 ratio to enable its use across other blockchain networks; an ERC-20 compatible token and... - Canonical URL: https://iq.wiki/wiki/wrapped-avax-wavax - Categories: Cryptoassets - Created: 2025-07-16T19:46:05.111Z - Last updated: 2025-07-21T15:11:28.774Z - Source: IQ.wiki — the world's largest blockchain and crypto encyclopedia (https://iq.wiki) --- **Wrapped AVAX (WAVAX)** is a tokenized representation of the native [AVAX](https://iq.wiki/wiki/avalanche-avax) [cryptocurrency](https://iq.wiki/wiki/cryptocurrency), designed to facilitate its use across various [blockchain](https://iq.wiki/wiki/blockchain) networks beyond the [Avalanche](https://iq.wiki/wiki/avalanche) ecosystem. It maintains a 1:1 peg with [AVAX](https://iq.wiki/wiki/avalanche-avax), meaning one WAVAX token is equivalent in value to one [AVAX](https://iq.wiki/wiki/avalanche-avax) token. [\[1\]](#cite-id-WZvgiS6v7M) [\[2\]](#cite-id-qCN4UVyNkZ) ## Overview Wrapped AVAX (WAVAX) serves as an essential bridge for the [Avalanche](https://iq.wiki/wiki/avalanche) [blockchain's](https://iq.wiki/wiki/blockchain) native token, [AVAX](https://iq.wiki/wiki/avalanche-avax), enabling its seamless integration into the broader [decentralized finance (DeFi)](https://iq.wiki/wiki/defi) landscape. The primary purpose of WAVAX is to provide an [ERC-20](https://iq.wiki/wiki/erc-20) compatible version of [AVAX](https://iq.wiki/wiki/avalanche-avax) on [Avalanche](https://iq.wiki/wiki/avalanche)'s C-Chain, which is the [smart contract](https://iq.wiki/wiki/smart-contract) chain of the [Avalanche](https://iq.wiki/wiki/avalanche) network. This compatibility is crucial because many [DeFi](https://iq.wiki/wiki/defi) applications and platforms are built upon or primarily interact with the [ERC-20](https://iq.wiki/wiki/erc-20) standard, which originated on the [Ethereum](https://iq.wiki/wiki/ethereum) [blockchain](https://iq.wiki/wiki/blockchain). By converting [AVAX](https://iq.wiki/wiki/avalanche-avax) into WAVAX, the token gains increased interoperability, allowing it to be utilized in a wider range of [decentralized applications](https://iq.wiki/wiki/decentralized-application), [liquidity pools](https://iq.wiki/wiki/liquidity-pool), and trading platforms that might not natively support the [AVAX](https://iq.wiki/wiki/avalanche-avax) token directly. The process of creating WAVAX involves "wrapping" [AVAX](https://iq.wiki/wiki/avalanche-avax) tokens, which can subsequently be "unwrapped" or redeemed for the original [AVAX](https://iq.wiki/wiki/avalanche-avax) tokens at any time, maintaining the 1:1 value ratio [\[1\]](#cite-id-WZvgiS6v7M). ## Technology WAVAX operates on a fundamental principle of token wrapping, where a native [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) is locked on its original [blockchain](https://iq.wiki/wiki/blockchain) and an equivalent token is [minted](https://iq.wiki/wiki/minting) on another [blockchain](https://iq.wiki/wiki/blockchain). For WAVAX, this means that each WAVAX token is backed by an equal amount of [AVAX](https://iq.wiki/wiki/avalanche-avax), which is held in reserve. This 1:1 ratio ensures that the value of WAVAX remains directly tied to that of [AVAX](https://iq.wiki/wiki/avalanche-avax), providing stability and trust in its representation. The technical foundation of WAVAX is its adherence to the [ERC-20](https://iq.wiki/wiki/erc-20) token standard. Its widespread adoption means that any wallet, exchange, or [dApp](https://iq.wiki/wiki/decentralized-application) that supports [ERC-20](https://iq.wiki/wiki/erc-20) tokens can also support WAVAX. This compatibility allows WAVAX to be easily integrated into various [DeFi](https://iq.wiki/wiki/defi) protocols, including [decentralized exchanges (DEXs)](https://iq.wiki/wiki/decentralized-exchange), lending platforms, and yield farming applications, without requiring specific adaptations for the native [AVAX](https://iq.wiki/wiki/avalanche-avax) token. The wrapping process typically involves a [smart contract](https://iq.wiki/wiki/smart-contract) that facilitates the locking of [AVAX](https://iq.wiki/wiki/avalanche-avax) and the [minting](https://iq.wiki/wiki/minting) of WAVAX, and vice versa for unwrapping, ensuring a secure and automated conversion mechanism [\[1\]](#cite-id-WZvgiS6v7M). ## Use Cases * **Lending and Borrowing**: Users can deposit WAVAX into [DeFi](https://iq.wiki/wiki/defi) lending protocols to earn interest or use it as collateral to borrow other assets. This opens up opportunities for capital efficiency and leveraging assets within the [DeFi](https://iq.wiki/wiki/defi) space. * **Liquidity Provision**: WAVAX can be paired with other tokens in [liquidity pools](https://iq.wiki/wiki/liquidity-pool) on [DEXs](https://iq.wiki/wiki/decentralized-exchange), enabling users to earn fees from trades and contribute to the overall liquidity of the decentralized market. * **Yield Farming**: Participation in various yield farming strategies becomes possible with WAVAX, where users can stake or lock their tokens in [smart contracts](https://iq.wiki/wiki/smart-contract) to earn additional [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) rewards. * **Interoperability**: WAVAX facilitates the movement and utilization of [AVAX's](https://iq.wiki/wiki/avalanche-avax) value across different [blockchain](https://iq.wiki/wiki/blockchain) ecosystems that are compatible with [ERC-20](https://iq.wiki/wiki/erc-20), thereby enhancing the overall interoperability of the [Avalanche](https://iq.wiki/wiki/avalanche) network with other major [blockchain](https://iq.wiki/wiki/blockchain) platforms [\[1\]](#cite-id-WZvgiS6v7M).