BiT Global has filed a lawsuit against Coinbase, claiming that the well-known exchange is unfairly preparing to remove Wrapped Bitcoin from the market in favor of its own cryptocurrency, cbBTC.
According to this lawsuit, filed on Dec 13, 2024, Coinbase engaged in unfair business practices when it decided to delete WBTC, which was supposed to happen on Dec 19. The crypto custodian argues that this action violates federal and state laws.
BiT Global’s legal complaint accuses Coinbase of designing its actions to monopolize the wrapped Bitcoin market. Wrapped Bitcoin, or WBTC, is the 18th largest cryptocurrency by market capitalization.
It backs 1:1 by Bitcoin and uses the Ethereum platform to enable Bitcoin to interact in DeFi protocols. If BiT Global is anything to go by, Coinbase is simply offloading WBTC from its platform to open the market for cbBTC.
As BiT Global points out, Coinbase’s action is not just a change of product strategy. It is an extermination strategy aimed at its competitors. The legal complaint portrays Coinbase as using monopolistic strategies typical for a centralized tech firm and accuses the exchange of milking users for cash under the guise of decentralization.
Impact on WBTC circulation
BiT Global also explained how Coinbase’s delisting impacted the stock market. After the news, the circulation of WBTC has gone down. BiT Global identified a decrease in circulation by 5% in the two weeks after the announcement was made.
The custodian claims this demonstrates that Coinbase’s actions have already begun to negatively impact the market for WBTC. This further supports their allegations of anti-competitive behavior.
Coinbase listing and delisting of WBTC
Coinbase listed cbBTC in Sept. 2024, offering it as an alternative to WBTC. In Nov 2024, the exchange delisted WBTC, citing the token’s failure to meet listing standards. This decision has led to an ongoing legal dispute between Coinbase and BiT Global.
According to the lawsuit, technical difficulties were not the basis for the exchange’s decision to delist WBTC and promote cbBTC. Rather, it is a component of a market-control strategy.
Related: Coinbase prepares to delist USDT under EU MiCA regulations
