Main points
- Coinbase will stop trading Wrapped Bitcoin (wBTC) on December 19, Concerns about “listing standards” were cited.
- The move coincides with Coinbase launching its own wrapped Bitcoin tokencbBTC, on the Base blockchain.
- wBTC provider BitGo has Faces scrutiny after partnering with BiT Globala company linked to Justin Sun.
Coinbase delists wBTC due to listing standards concerns
Coinbase has announced that it will remove Wrapped Bitcoin (wBTC) from its platform by December 19, 2024. The exchange cited “listing standards” as the reason for the decision.
in a tweetthe exchange confirmed the delisting and stated:
“We regularly monitor assets on our exchange to ensure they meet our listing standards. Based on our recent review, Coinbase will suspend wBTC trading on December 19, 2024 at approximately 12:00 PM ET.”
Coinbase emphasized that it regularly reviews all assets to ensure they meet its requirements. Meanwhile, there haven’t been any specific takedowns on its platform. Instead, Coinbase only claimed that the decision to delist wBTC was based on a “latest review.”
The Wrapped BTC team expressed disappointment with Coinbase’s decision to delist Wrapped Bitcoin. them X specified above wBTC remains committed to “compliance, transparency, and decentralization.”
Additionally, the team describes wBTC as “the most decentralized wrapped BTC solution on the market.”
Wrapped BTC (wBTC), launched by BitGo, Allow Bitcoin to run on non-native blockchains like Ethereum. As a Bitcoin-backed token, it can be seamlessly integrated with decentralized applications.
This delisting follows Coinbase’s emission cbBTC, a Bitcoin token wrapped on its underlying blockchain.
According to its announcement, cbBTC is fully backed by one Bitcoin held in its reserves. This means that for every cbBTC in circulation, Coinbase securely stores your Bitcoin equivalent.
The launch of cbBTC demonstrates Coinbase’s commitment to building out its version of wrapped Bitcoin.
Controversy surrounding BitGo and Justin Sun’s Bit Global
BitGo’s Wrapped Bitcoin recent because of its attention partnership Custodian BiT Global has ties to Justin Sun. This relationship has raised concerns among some in the crypto community about the centralization risks associated with wBTC.
BitGo CEO Mike Belshe clarified in a statement X live meeting BiT Global’s legal structure limits individual ownership to less than 20%. He also ensures that the keys to the asset are distributed among multiple parties.
Belcher defended the partnership, saying: “Today we are fiduciaries and we have a responsibility to make sure assets are protected, no matter where they are stored.”
The BitGo CEO also criticized Coinbase’s cbBTC, arguing that it lacks the decentralized structure needed for DeFi. He believes that Coinbase’s approach of centralized control contradicts the principles of decentralized finance..
Belshe said: “If the DeFi community chooses the central bank Coinbase to be the ultimate steward, then I think all hope for DeFi should be dashed.”
The debate about DeFi centralization
Critics questioned Coinbase’s decision to replace wBTC with cbBTC, arguing that it could lead to increased centralization. Belshe believes Coinbase’s model risks creating a system controlled by a central authority.
Despite criticism, Coinbase’s move marks a major shift in the race to wrap up Bitcoin dominance. The debate highlights the broader battle between centralization and decentralization in the cryptocurrency space.
The delisting of wBTC and the launch of cbBTC may reshape how Bitcoin interacts with the Ethereum and Base blockchains.
View all posts by Rida Fatima
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