WETH Explained: Why Wrapped Ether Exists and How to Use It
Understand WETH — why Ethereum needs a wrapped version of its native token and how it works in DeFi.
What Is WETH?
Wrapped Ether (WETH) is an ERC-20 token version of ETH. While ETH is Ethereum's native currency, it predates the ERC-20 standard and cannot directly interact with many DeFi protocols that expect ERC-20 tokens. WETH solves this by wrapping ETH in an ERC-20-compliant token at a 1:1 ratio.
Why Does WETH Exist?
- ERC-20 compatibility: Many DEXs and protocols only accept ERC-20 tokens
- Standardization: Enables ETH to be treated identically to other tokens
- Smart contract interactions: Simplifies contract logic by standardizing the interface
How Wrapping Works
Wrapping is instant and reversible. You send ETH to the WETH contract and receive WETH. To unwrap, you send WETH back and receive ETH. The ratio is always 1:1.
WETH on Layer 2s
On Layer 2 networks like Arbitrum, Base, and Optimism, the native token is already bridged ETH. WETH on these networks follows the same wrapping pattern for protocol compatibility.
Using WETH on Alkizen
Alkizen handles WETH wrapping automatically when needed, so you never have to manually wrap or unwrap your ETH.