TLDR
Coinbase is delisting wBTC (Wrapped Bitcoin) effective December 19, 2024, citing listing standards
Coinbase recently launched its own wrapped Bitcoin product called cbBTC on Base blockchain
BitGo (wBTC provider) formed a joint venture with BiT Global, partially owned by Justin Sun
BitGo CEO Mike Belshe defended the BiT Global partnership, stating Sun has limited control
Belshe criticized Coinbase’s cbBTC as being too centralized
Cryptocurrency exchange Coinbase has announced plans to remove Wrapped Bitcoin (wBTC) from its trading platform, with the delisting scheduled for December 19, 2024.
The company cited “listing standards” as the primary reason for this decision, which comes shortly after launching its own bitcoin bridging solution.
The move follows Coinbase’s recent introduction of cbBTC, its proprietary wrapped bitcoin product that operates on the Base blockchain. This new offering serves a similar purpose to wBTC, allowing bitcoin to be used on different blockchain networks.
Wrapped Bitcoin, developed by BitGo, has been a popular tool in the cryptocurrency ecosystem, enabling bitcoin holders to use their assets on the Ethereum blockchain and other networks. The token works by having bitcoin held in custody while an equivalent amount of wBTC is minted on another blockchain.
The timing of Coinbase’s decision has drawn attention from the cryptocurrency community, as it coincides with recent developments in BitGo’s business relationships. BitGo recently entered into a joint venture with BiT Global, a custody provider partially owned by crypto entrepreneur Justin Sun.
We regularly monitor the assets on our exchange to ensure they meet our listing standards. Based on our most recent review, Coinbase will suspend trading for wBTC (wBTC) on December 19, 2024, on or around 12pm ET.
— Coinbase Assets (@CoinbaseAssets) November 19, 2024
The partnership between BitGo and BiT Global has sparked discussions within the crypto community, particularly regarding Sun’s involvement. However, BitGo CEO Mike Belshe has addressed these concerns, explaining that Sun’s influence over BiT Global is limited by the custodian’s legal structure.
According to Belshe, no single individual can maintain more than 20% ownership in BiT Global. He also emphasized that the custody solution employs a multi-party key system, distributing control among various participants.
In recent statements, Belshe defended his company’s approach while criticizing Coinbase’s new offering. He specifically addressed the BitGo-BiT Global partnership critics, suggesting their objections might be motivated by competing interests rather than genuine concerns about wBTC.
The BitGo CEO emphasized his company’s role as a fiduciary, stating their commitment to asset protection regardless of where the assets are held. This commitment, he argues, remains unchanged by their new business relationships.
Belshe took aim at Coinbase’s cbBTC product, expressing concerns about its centralized nature. He argued that BitGo’s key storage model provides superior security compared to Coinbase’s solution.
The debate between the two companies highlights an ongoing discussion in the cryptocurrency industry about the balance between centralization and decentralization. Belshe warned that embracing centralized solutions like cbBTC could undermine the principles of decentralized finance (DeFi).
For users of the Coinbase platform, the December 19 deadline marks the end of direct wBTC trading on the exchange. This change will require traders to find alternative venues for wBTC transactions or consider switching to different wrapped bitcoin products.
Coinbase’s decision affects only the trading of wBTC on its platform and does not impact the overall functionality or availability of wBTC on other exchanges or platforms. The token continues to operate on various blockchain networks.
BitGo maintains its position as a key player in the cryptocurrency custody space, with Belshe defending their approach to security and decentralization. The company continues to operate its wBTC product independently of Coinbase’s decision.
The competition between different wrapped bitcoin solutions highlights the evolving nature of cross-chain compatibility in the cryptocurrency market. Each provider offers distinct approaches to bridging bitcoin with other blockchain networks.
Users currently holding wBTC on Coinbase will need to make decisions about their holdings before the December deadline. The exchange is expected to provide detailed instructions for users regarding the delisting process.
The post Coinbase Announces Wrapped Bitcoin Delisting, Sets December Deadline appeared first on Blockonomi.
