Coinbase refutes ‘baseless’ BiT Global wBTC suit

The US crypto exchange wrote that no law forces Coinbase to “compromise the integrity of its platform” by doing business with Justin Sun’s BiT Global.

Coinbase has asked a US court to dismiss BiT Global’s lawsuit in Northern California seeking $1 billion in relief and a temporary restraining order delisting wrapped Bitcoin (wBTC).

Justin Sun’s BiT Global filed a lawsuit against Coinbase on December 13 over plans to remove its wrapped Bitcoin (BTC) asset from its US-based exchange. BiT Global claimed that delisting wBTC was illegal, would cause irreparable harm to the token’s economy, and was unfair because Coinbase was listing non-serious cryptocurrencies such as meme coins.

Additionally, the launch of cbBTC violated antitrust laws and threatened to create a Coinbase-controlled monopoly in the tokenized Bitcoin market.

The crypto exchange argued that California’s Unfair Competition Act was unenforceable. DefiLlama confirmed that cbBTC is among the top 10 tokenized BTC assets by market cap.

Coinbase has the right to choose who it does business with, and no law requires bad actors or suspected bad actors to be allowed on the exchange… Coinbase has nothing approaching monopoly power, and the decision to delist wBTC is a right and justified decision. about the careful scrutiny it had carried out and the unacceptable risk of doing business with an entity linked to Mr Sun.

Coinbase response to BiT Global case

According to a Dec. 17 court filing, significant changes in wBTC’s management, specifically Justin Sun’s majority control over Bitcoin reserves, have led Coinbase and other organizations to reconsider their support for the asset.

The Securities and Exchange Commission charged Sun and three of its wholly owned companies with federal violations. Additionally, the FBI has reportedly opened an investigation into potential terrorist financing involving Sun.

The U.S. Department of Justice did not charge Sun at the time, and authorities did not issue any arrest warrant for the Tron (TRX) founder.

Coinbase noted that new wBTC risk assessments in line with company listing standards raise red flags, primarily due to Sun’s involvement. The exchange described its decision as “common sense” and said it was necessary to protect its customers. The company also emphasized that the delisting of wBTC will not impact the token’s overall on-chain activity, which largely occurs on other platforms.

BiT cannot claim damages, let alone irreparable losses, from the delisting of an exchange where less than 1% of transactions involving wBTC were made. Perhaps this is why BiT maintained its claims for almost a month before filing a lawsuit and did not believe in the urgency of any help.

The US crypto giant asked the California Court to rule against BiT Global’s TRO request and $1 billion relief package due to the firm’s alleged ties to an individual and the fabricated emergency regarding wBTC.

We have submitted our response to BiT Global’s effort to stop us from delisting wBTC before any discovery is made or even an official response to the fraudulent claims. We explain why this case has no merit and why TRO requests should be denied. You can read the whole thing…

— paulgrewal.eth (@iampaulgrewal) December 17, 2024