BiT Global Accuses Coinbase of Unfairly Delisting Wrapped Bitcoin (WBTC) in Lawsuit

BiT Global has taken legal action against Coinbase, accusing the San Francisco-based exchange of unfairly planning to delist Wrapped Bitcoin (WBTC)

Coinbase is facing legal action from crypto custodian BiT Global over its alleged plan to unfairly delist Wrapped Bitcoin (WBTC) in favor of its own version of the token, Coinbase Wrapped BTC (cbBTC).

The lawsuit, filed on Friday, alleges that Coinbase's move to remove WBTC from its platform by Dec. 19 constitutes an unfair business practice and violates federal and state laws.

Coinbase recently announced that it will be moving the order books for wrapped Bitcoin (wBTC) to limit-only mode. This means that limit orders can still be placed and canceled, and matches may occur. For more info on this update, please visit: https://t.co/aZsdyDqkAS

According to the lawsuit, BiT Global, which custodies WBTC, claims that Coinbase's decision to delist WBTC is a predatory tactic to monopolize the wrapped Bitcoin market. The custodian alleges that Coinbase's actions are aimed at promoting cbBTC, which is backed by the exchange, and squeezing out competition.

The lawsuit, which was filed in the U.S. District Court for the Northern District of California, claims that Coinbase is using tactics typically employed by centralized tech giants to eliminate competitors. It describes the exchange's behavior as a “cash grab” that is being masked as a commitment to decentralization.

In particular, BiT Global points to Coinbase's listing of meme coins and tokens, including Dogwifhat (WIF), Pepe (PEPE), and Mog Coin (MOG), as evidence of the exchange's prioritization of profitability over genuine innovation or value.

The custodian alleges that Coinbase's decision to delist WBTC has had a direct impact on the token's circulation, which has declined by 5% over the last two weeks. BiT Global claims that this decline is a result of Coinbase's actions.

As a refresher, WBTC is a critical component of decentralized finance (DeFi) because it enables Bitcoin (BTC) holders to interact with Ethereum-based applications even though BTC and Ether (ETH) are technically incompatible.

Coinbase launched cbBTC in September, describing it as an alternative to WBTC. Following the launch, the exchange delisted WBTC in November, stating that the token failed to meet its listing standards — a move that sparked the legal dispute.

BiT Global's lawsuit also highlights the controversial partnership between BiT Global and BitGo, the custodian behind WBTC. Some members of the DeFi community have raised concerns about Justin Sun, the founder of the Tron network, being involved with BiT Global, suggesting that it introduces risks due to his influence.