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Justin Sun's wBTC Involvement is 'Unacceptable Risk,' Coinbase Says
Coinbase responded to BiT Global's lawsuit over its wBTC delisting with some harsh words.
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Following Coinbase’s delisting of wBTC, BiT Global filed a suit against Coinbase for wrongly favoring its competing token, cbBTC. Coinbase just responded noting that the reason for the denial is the risk tied to BiT Global.
What’s the Scoop?
- Unanswered Questions: Coinbase asked BiT Global about its ownership and Justin Sun’s involvement with wBTC when the partnership was first announced, but the firm refused to answer.
- BiT Global Lawsuit: Following the questioning, Coinbase decided to delist wBTC “due to the unacceptable risk”. BiT Global then filed a suit accusing Coinbase of wrongly favoring its competing token, cbBTC.
- Response to Suit: In response to BiT Global’s suit, Coinbase put out a response that the reasoning for delisting wBTC is due to Justin Sun’s murky past. "At the conclusion of its diligence, Coinbase concluded that Mr. Sun’s affiliation with—and potential control over—wBTC presented an unacceptable risk to its customers and the integrity of its exchange," the company detailed in its latest filing.
- Justin Sun's Past: The SEC sued Justin Sun and his companies for securities fraud. He was accused of manipulating the value of a cryptocurrency and paying celebrities to promote the token without any disclosures.
Bankless Take:
Coinbase delisting wBTC sends a message about its red lines around risk and transparency. Specifically calling out Justin Sun as the main reason behind the delisting of wBTC, marks a dramatic ramping up of tensions with a controversial figure with deep holdings across crypto including projects like Trump's WLFI.