Coinbase Legal Head Addresses $1B Lawsuit Related To WBTC Deletion
Coinbase's chief legal officer has responded to criticism of the exchange's token listing and detailed operations after a $1 billion lawsuit wrapped the company up accusing it of anti-competitive behavior regarding Bitcoin.
Crypto exchange Coinbase has been sued for more than $1 billion by BiT Global Digital, accusing the company of harming the crypto market over its decision to cancel Wrapped Bitcoin (WBTC) in November.
In a December 13 complaint, BitGlobal alleged that Coinbase decided to cancel wBTC in order to promote its own competing Bitcoin-based token, Coinbase BTC (cbBTC).
A day after the lawsuit, Coinbase's chief legal officer, Paul Grewal, defended the exchange's approach, emphasizing its commitment to high standards.
“When a property no longer meets our listing criteria, we drop it. We list it when another property can meet or exceed market criteria without paying those criteria,” Grewal wrote on X.
Source: Paul Grewal
The lawsuit was filed on November 19, four months after Coinbase first teased the development of the cbBTC token, which was seen as a major positive development in strengthening the adoption of Bitcoin-native decentralized finance (DeFi), or BTCFi.
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Crypto industry controversy following wBTC cancellation
Grewal's post drew backlash from crypto industry insiders, including Tron founder Justin Xu, who objected to the company's transparency, questioning the alignment between Grewal's statement and earlier comments by Coinbase CEO Brian Armstrong.
Source: Justin Sun
The Sun's attached screenshot shows Coinbase CEO Brian Armstrong stating that the exchange is “asset agnostic” in the belief that “consumers should have choice in the crypto economy.”
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Coinbase faces $1 billion WBTC liquidation lawsuit: What you need to know
The lawsuit alleges that Coinbase's actions monopolized the bitcoin market, which was sealed under the Sherman Act. The suit accuses Coinbase of predatory practices, including making false statements about compliance with wBTC to undermine its market position. BiT Global claims Coinbase's actions are designed to direct market dominance to cbBTC.
A Coinbase spokesperson reiterated the company's standards in a statement to Cointelegraph. “Coinbase is committed to maintaining the highest integrity of our listing standards. If an asset fails to meet those standards, it will be removed,” a spokesperson said.
The exchange announced the cancellation of the token on November 19, citing unknown failures to meet the requirements for listing the token.
The lawsuit was filed in the United States District Court for the Northern District of California by the law firm of Kneupper & Covey. According to BiT Global's lawyers, Coinbase has been boarding memecoins for trading on the platform since wBTC challenged compliance with listing requirements shortly after Coinbase released a similar product.
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