BiT Global Sues Coinbase for Planning to Delist Wrapped Bitcoin in Favor of cbBTC

2024-12-16 10:38:20 Primitive Reading

From decrypt by Mat Di Salvo

BiT Global has sued Coinbase for announcing plans to delist the largest Wrapped Bitcoin token—or WBTC—alleging that the San Francisco-based exchange did so in a "predatory and unfair" move that "violates both federal and state law."

A Friday lawsuit by the crypto custodian alleged that Coinbase, America’s biggest crypto exchange, unfairly plans to remove WBTC from its platform—a move planned for December 19—so it could push its own version of the digital token.

"Like all the centralized tech giants before it, Coinbase gives lip service to the innovation of a decentralized world," Friday's lawsuit reads. "But in the case of wrapped Bitcoin, Coinbase viewed it as just another cash grab."

The lawsuit further alleged that Coinbase’s listings of meme coins and tokens—such as Dogwifhat (WIF), Pepe (PEPE) and Mog Coin (MOG)—with “no inherent value” proves that the exchange delisted WBTC in a bid to have a monopoly over the industry.

WBTC is the 18th biggest cryptocurrency, with a market cap of $13.7 billion, according to CoinGecko. BiT Global helps custody the tokens, which are backed 1:1 with Bitcoin but run on Ethereum.

Traders use WBTC so they can use their Bitcoin holdings across other crypto platforms and applications that aren’t natively compatible with Bitcoin.

Coinbase launched its own wrapped Bitcoin token in September, dubbed Coinbase Wrapped BTC, or cbBTC. Then, last month, it delisted WBTC, citing that it did not meet the exchange’s listing standards.

BiT Global alleged Friday that this was an unfair business practice. “Having decided to copycat WBTC with its own product, Coinbase resorted to unfair and deceptive tactics that long been used by tech giants to crush their competition,” BiT Global’s lawsuit added.

The crypto custodian added in the lawsuit that the circulation of WBTC dropped by 5% in two weeks following the delisting, alleging that this was more evidence that Coinbase “coveted WBTC’s market share and wanted it for itself.”

Back in August—ahead of cbBTC’s launch—industry experts told Decrypt that the token had potential to dominate the crypto market.

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