BiT Global sues Coinbase for $1b over WBTC delisting

Justin Sun-backed BiT Global has filed a lawsuit against crypto exchange Coinbase for wrongfully delisting WBTC in order to promote a rival Bitcoin product.

BiT Global has filed a $1 billion lawsuit against Coinbase, alleging that the US crypto exchange illegally replaced its Wrapped Bitcoin (WBTC) product with a “dummy” cbBTC token.

Wrapped Bitcoin was the first tokenized Bitcoin (BTC) asset in crypto, allowing users to trade BTC on networks like Ethereum. BitGo initially managed custody of WBTC since its launch in January 2019. However, BitGo announced a deal in August 2020 to share operations among three companies, including Sun’s BiT Global.

The new agreement, which was the subject of intense criticism from the community, appointed Hong Kong-based BiT Global as the primary WBTC custodian. Various protocols such as Aave and Sky considered token removal as a collateral option but refrained from taking action.

Coinbase said it would delist WBTC starting December 19, 2024 due to listing standards, Crypto.news reported in late November. This comes after Coinbase announced the cbBTC token on its overlay network Base and Ethereum on September 12, initially teasing the token following the ongoing WBTC controversy.

Legal advisors at BiT Global’s attorneys, Kneupper & Covey, argued that Coinbase’s delisting of WBTC violated anti-competitive policies and federal rules.

We believe this decision sets a terrible precedent for everyone in the cryptocurrency space. Who is safe if an exchange the size of Coinbase can delist a cryptocurrency just as it plans to launch its own competing product? So who’s next?

Kevin Kneupper of Kneupper & Covey

According to the lawsuit, Coinbase’s assertion of listing standards was also an insufficient reason for the decision. Documents filed in the Northern District of California say Coinbase lists “basically worthless” coins like Pepe (PEPE). BiT Global is seeking damages in excess of $1 billion as well as injunctive relief against Coinbase.

WBTC, meanwhile, is still the undisputed tokenized Bitcoin asset with a market of $13.7 billion, more than its $8 billion valuation when the fiasco began in the middle of the second quarter of 2024.