Coinbase fights global demand for BiT over WBTC withdrawal

Coinbase has issued a rebuttal to a lawsuit by BiT Global, an entity affiliated with Justin Sun, challenging the exchange’s decision to delist Wrapped Bitcoin (WBTC).

Paul Grewal, the firm’s chief legal officer, announced the filing to X, saying his firm had offered its response to BiT Global’s effort to stop the withdrawal of WBTC before any discovery or formal response to its claims. claims, which he described as false.

Coinbases defense

In the filing shared by Grewal, Coinbase defended its actions, stating that BiT Global did not clarify its ownership structure or address concerns about the involvement of TRON founder Justin Sun. The exchange argued that its potential influence posed significant risks to customers as well as the integrity of the platform.

“BiT seeks to compel Coinbase to do business with an entity that no longer meets Coinbase’s standards due to Mr. Sun,” the document says.

It also noted that BiT Global delayed filing its lawsuit and motion for a temporary restraining order for nearly a month, thereby undermining any claim for urgent damages.

The San Francisco-based exchange also dismissed allegations of financial and reputational damage as speculative, noting that WBTC makes up less than 1% of its trading volume. It also argued that any loss of confidence in the product stems from its association with Sun rather than the decision to delist.

The crypto platform generally defended its action as a legitimate exercise of business judgment to protect itself and its customers, citing court precedents supporting the rights of tech operations to set their own standards. He also dismissed BiT Global’s legal allegations as unfounded and urged the court to deny emergency relief.

Reaction and concerns about Sun’s participation

In November, Coinbase announced its decision to delist WBTC on December 19, attributing its decision to concerns over the asset’s association with Sun. This move caused a huge backlash, with many members of the crypto community accusing the company of favoring its own tokenized Bitcoin product, cbBTC.

In response, BiT Global filed a lawsuit on December 13, accusing the exchange of engaging in monopolistic behavior, using predatory tactics to undermine WBTC’s market position, and making false statements about the token’s compliance with listing standards.

TRON’s founder also reacted by criticizing the competitor’s offer. It claimed that it has no proof of reserve, has not been audited and could allow the exchange to freeze user balances, leading to security risks for decentralized finance (DeFi).

Coinbase, however, countered this by pointing to Sun’s history of allegations of financial misconduct, including claims of fraud and market manipulation. The latest court filing noted that the 34-year-old has been sued by the US Securities and Exchange Commission (SEC) and is reportedly under investigation by multiple law enforcement officials.

SPECIAL OFFER (Sponsored) Binance Free $600 (Exclusive to CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

LIMITED OFFER for CryptoPotato readers on Bybit – Use this link to register and open a FREE $500 position with any currency!