Coinbase Defends Decision to Delist WBTC
Coinbase recently responded to BiT Global’s legal attempt to stop the delisting of wrapped Bitcoin (WBTC), arguing that the lawsuit lacks merit and the request for a temporary restraining order (TRO) should be denied.
Background of the Case
Coinbase decided to delist WBTC due to concerns about risks associated with TRON founder Justin Sun and the lack of transparency about the token’s reserves.
Paul Grewal, Coinbase’s chief legal officer, stated that the lawsuit filed by BiT is baseless and should be denied.
Concerns Regarding Justin Sun
Coinbase detailed its internal review process that led to the delisting decision, citing Sun’s history of alleged fraud and market manipulation as a significant risk to its platform and users.
The exchange also mentioned BiT’s failure to provide transparency on the ownership structure of WBTC reserves, which compounded Coinbase’s concerns.
Impact of Delisting
BiT Global accused Coinbase of unfairly delisting WBTC to promote its own competing asset, cbBTC, and claimed that the decision would harm its reputation and finances.
In response, Coinbase argued that the delisting would not have a significant impact, as less than 1% of global WBTC transactions occur on its platform. It also pointed to declining WBTC circulation before the delisting announcement, attributing it to Sun’s involvement.
Legal Proceedings
The case highlights the growing scrutiny over Sun’s influence in the crypto space, as he faces legal challenges from the SEC and potential criminal investigations.
A hearing on BiT’s TRO request is scheduled for Dec. 18, which could temporarily delay Coinbase’s delisting of WBTC set for Dec. 19.
