Coinbase's general counsel has responded to criticism about the exchange's Token listing and delisting practices after being sued for $1 billion for alleged anti-competitive behavior related to Wrapped Bitcoin.
The cryptocurrency exchange Coinbase is facing a lawsuit of over $1 billion from BiT Global Digital, which alleges that Coinbase has damaged the cryptocurrency market through its decision to delist Wrapped Bitcoin (WBTC) in November.
In the lawsuit filed on December 13, BiT Global stated that Coinbase decided to delist WBTC to promote its own Bitcoin-based competitor Token, Coinbase BTC (cbBTC).
A day after the lawsuit, Coinbase's general counsel, Paul Grewal, defended the exchange's approach, emphasizing its commitment to high listing standards.
"When an asset no longer meets our listing standards, we delist it. When another asset can meet or exceed market demands without compromising those standards, we list it," Grewal wrote on X.
Source: Paul Grewal
The lawsuit was filed on November 19, four months after Coinbase first revealed the development of the cbBTC Token, which is considered a significant positive step in driving the adoption of Bitcoin-based DeFi, or BTCFi.
Reactions from the cryptocurrency industry after the WBTC Delisting
Grewal's post received mixed reactions from within the cryptocurrency industry, including Tron founder Justin Sun, who challenged the company's transparency and questioned the consistency between Grewal's statement and previous comments made by Coinbase CEO Brian Armstrong.
Source: Justin Sun
The screenshot shared by Sun shows Coinbase CEO Brian Armstrong stating that the exchange "does not favor any assets" due to a belief that "consumers should have choice in the cryptocurrency economy."
Coinbase Faces $1 Billion Lawsuit Over wBTC Delisting: What You Need to Know
The lawsuit claims that Coinbase's actions are equivalent to monopolizing the Wrapped Bitcoin market under the Sherman Act. The lawsuit alleges that Coinbase engaged in unlawful anti-competitive behavior, including providing misleading information about wBTC's compliance to undermine its market position. BiT Global argues that Coinbase's actions were designed to steer market dominance towards cbBTC.
In a statement to TinTucBitcoin, a Coinbase spokesperson reiterated the company's standards. "Coinbase is committed to maintaining high integrity in our listing standards. If an asset no longer meets those standards, it will be delisted," the spokesperson said.
The exchange announced the Token delisting on November 19, citing undisclosed reasons for not meeting its Token listing standards.
The lawsuit was filed by the law firm Kneupper & Covey in the U.S. District Court for the Northern District of California. According to BiT Global's lawyers, Coinbase introduced a memecoin for trading on its platform while challenging the compliance of wBTC with listing standards shortly after launching a similar product.
