BiT Global has agreed to dismiss its legal complaint against Coinbase following the delisting of the wrapped Bitcoin token wBTC. The lawsuit was dropped with prejudice, meaning it cannot be refiled, and both sides confirmed they would cover their own legal fees.
Dispute over token competition ends
The case was initiated in December 2024 by law firm Kneupper & Covey on behalf of BiT Global, a company backed by TRON founder Justin Sun. The complaint accused Coinbase of anti-competitive practices for removing wBTC shortly after launching its own competing token, cbBTC. The lawsuit alleged this move violated multiple state and federal laws by eliminating market access for wBTC.
Coinbase responded by asserting its right to protect users through strict listing standards. The company’s Chief Legal Officer, Paul Grewal, said the decision supports Coinbase’s responsibility to manage platform risks. Grewal emphasized that Coinbase will not maintain listings that pose risks to customers and will only support tokens meeting its standards. His statements prompted criticism from industry figures, including Sun, who questioned Coinbase’s transparency.
DeFi platforms tighten conditions on wBTC
The controversy surrounding wBTC extended beyond Coinbase. Sun’s involvement with the token led to trust concerns across Ethereum-based DeFi platforms. MakerDAO and Aave both reviewed their stance on wBTC, considering full removal but eventually opting to impose stricter risk parameters instead. Although wBTC helps bring Bitcoin liquidity to Ethereum, its reliance on centralized custodians raises questions about asset backing and control.
wBTC was initially administered solely by BitGo. After Sun’s partnership with BitGo, several community members expressed concerns about governance and asset safety. BitGo CEO Mike Belshe defended the company’s security practices, stating that BitGo continues to uphold strong standards and remains a trusted player in the space.
Legal challenges and market outlook
The federal judge overseeing the case previously ruled in Coinbase’s favor, confirming the exchange’s legal right to delist wBTC. That ruling marked a setback for BiT Global, weakening its legal position before the recent settlement. Sun had criticized Coinbase for what he viewed as inconsistent messaging, pointing to past statements by CEO Brian Armstrong that suggested the exchange was neutral about asset listings.
According to CoinGecko data, wBTC currently has a market cap of approximately $13.6 billion. Coinbase’s cbBTC, the newer competitor, is valued at around $4.7 billion. Both tokens are trading near all-time high valuations.