Coinbase has planned to delist wBTC after announcing its own wrapped bitcoin cbBTC

What’s new? Leading US centralized crypto exchange (CEX) Coinbase has announced the cessation of trading of wrapped bitcoin (wBTC). Coinbase noted that it regularly reviews assets to ensure compliance with internal listing standards. Presumably, another review has determined that wBTC no longer meets the criteria. Trading of the asset on Coinbase will be halted on December 19.

Source: X.com

What else is known? Notably, the post was published shortly after Coinbase announced its own version of the wrapped bitcoin cbBTC. It will be available on the Coinbase-developed Layer 2 (L2) Base network based on the Ethereum blockchain.

wBTC, like other wrapped cryptocurrencies, is intended to allow the native token of one blockchain to be used in another blockchain. wBTC is an ERC-20 standard token and is intended for use in decentralized applications (dApps) of the Ethereum ecosystem. With it, bitcoin can be used in revenue-generating DeFi protocols that are not available in the Bitcoin blockchain.

The creation of wBTC involves locking BTC in the native blockchain and issuing a similar volume of coins in Ethereum. A regulated US-based custodian company, BitGo, is responsible for storing the original coins and issuing new wBTC.

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In August, the company received increased attention as it announced a joint venture with BiT Global, a custodian partially owned by Justin Sun, the creator of the TRON (TRX) blockchain and head of centralized crypto exchanges HTX (formerly Huobi) and Poloniex.

Some in the crypto community have raised concerns about Sun’s involvement, but BitGo CEO Mike Belshe assured that the latter has minimal operational control over BiT Global. The structure of BiT Global suggests that no single person owns more than 20% and the keys are shared between multiple parties. Sun also emphasized that it does not control the keys to wBTC reserves and cannot transfer those assets.

As a result of the merger, the cold asset custody operations, which previously only took place in the United States, have been expanded to Hong Kong and Singapore as well.

The approach to storing assets has not changed, they are hosted on a multi-signature wallet. Registered as a licensed trust or corporate service provider (TCSP) in Hong Kong, BitGo and Bit Global have a fiduciary obligation to the members of the Wrapped Bitcoin DAO, a decentralized autonomous organization (DAO), to ensure the security of BTC in storage.

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Later in the interview, Michael Belshe criticized Coinbase’s cbBTC for its high level of centralization and emphasized that BitGo’s proposed key storage model is far superior to anything Coinbase has to offer.

Despite criticism from some in the community, wBTC supply has remained virtually unchanged since August and at the time of writing stood at 146 170 coins or $13,42 billion, according to data from analytics platform Dune.