Coinbase Reverses WBTC Elimination Decision.
In a court document turned in on Tuesday, Coinbase has forcefully defended its decision to delist Wrapped Bitcoin (WBTC). The trade said that the action was required to preserve the integrity of its platform and guard consumers against possible dangers connected to Justin Sun’s participation in WBTC. This legal conflict started when Coinbase revealed on November 19, 2024, its intentions to eliminate WBTC, a cryptocurrency created by Bitgo supported by Bitcoin (BTC).
Recently joining Bitgo’s WBTC operations, Bit Global has questioned Coinbase’s choice, alleging it resulted in notable financial losses and tarnished its standing. Currently claiming $1 billion in damages, Bit Global is also requesting quick re-listing of WBTC.
In its defence, Coinbase emphasised red flags discovered during its internal assessment process, especially in light of Bitgo’s August 2024 joint venture with Bit Global, a company with known ties to Justin Sun and the Tron ecosystem.
Questions About Justin Sun and Regulatory Reviewing Authority
According to Coinbase’s lawsuit, Justin Sun is allegedly under continuous legal conflict with the U.S. Securities and Exchange Commission (SEC) and subject of rumours of possible criminal investigations. These worries, Coinbase said, explained why it decided to delist WBTC.
The exchange said: “Continuing to list WBTC could compromise the integrity of Coinbase’s platform and expose customers to unnecessary risks.” Further bolstering its case for delisting the currency, Coinbase further accused Bit Global of hiding openness on its ownership structure and Sun’s influence.
Dedicated to Strict Listing Guidelines
Coinbase underlined that its choice was based on its will to maintain strict listing criteria. The exchange clarified that to guarantee user safety and keep confidence, it routinely examines assets on its platform and delists any that fall short of compliance criteria.
The filing said: “Coinbase earns and retains user trust by actively monitoring listed assets and removing those that fall out of compliance with our publicly announced listing criteria.”
Obstacles to Damage Claims for Reputational and Financial Losses
Reacting to Bit worldwide’s charges of financial damage, Coinbase refuted the assertions, pointing out that less than 1% of the WBTC worldwide trade volume came from trading activity on their platform.
“The lawsuit fails to explain how delisting WBTC from a single exchange, where it constitutes a de minimis (less than 1%) fraction of worldwide trading, may create irreversible harm. Coinbase countered Bit Global’s assertions of reputation damage as equally baseless.
Even in the face of major financial and reputational conflicts, Coinbase’s defence underlines its position on stressing user safety and following its compliance-driven rules as the legal struggle develops.
