Background on the Dispute
Coinbase and BiT Global have ended their legal dispute over the removal of wrapped Bitcoin (wBTC) from Coinbase’s platform. The delisting, which occurred late last year, was tied to concerns about Justin Sun’s influence. After BiT Global partnered with Sun and BitGo, Coinbase flagged the relationship as a potential risk to asset custody. This prompted the platform to drop wBTC just as it introduced its own alternative, cbBTC.
BiT Global responded by filing a lawsuit in California, claiming the delisting damaged wBTC’s liquidity and unfairly promoted Coinbase’s in-house token.
Case Closure Details
On June 7, both parties filed a joint agreement to dismiss the case with prejudice, preventing any future legal action on the same grounds. Each side will handle its own legal expenses. The filing didn’t reveal any further settlement terms.
Coinbase’s Chief Legal Officer, Paul Grewal, defended the exchange’s actions, emphasizing its authority to manage platform risks. “We will not be bullied into continuing to list an asset that puts our customers at risk,” he said.
Broader Impact on Crypto Platforms
This case sheds light on the complex dynamics of wrapped tokens and custodial control. Several DeFi platforms, including MakerDAO and Aave, had already restricted wBTC usage due to similar concerns around Sun’s involvement. As exchanges continue creating their own wrapped assets, disputes over competitive practices and token trust may become more frequent.
Ultimately, with the lawsuit resolved, both companies can now focus on advancing their core strategies—highlighting the broader industry challenge of balancing asset innovation with user safety.
