Complaint Claims Anti-Competitive Business Practices
BiT Global Digital Limited has slapped a $1 billion lawsuit on Coinbase, alleging anti-competitive practices following the exchange’s decision to delist Wrapped Bitcoin (wBTC). In the complaint filed on December 13 in the Northern District of California, the exchange allegedly took a calculated step aimed at paving the way for its rival token, cbBTC.
BiT Global, one of the main custodians of wBTC’s Bitcoin reserves alongside BitGo, has accused Coinbase of abusing its market dominance to suppress competition. The exchange maintains that the delisting was not merit-based but rather an attempt to weaken wBTC’s market position in favor of cbBTC.
Consumer Confidence
According to BiT Global, the November 19 delisting announcement led to massive financial losses and destroyed consumer confidence in Wrapped Bitcoin. The company argues that statements by Coinbase over wBTC’s failure to meet its listing standards were misleading and made at a time calculated to do the most harm to its reputation.
Kevin Kneupper, an attorney for BiT Global, said of the move, “This decision sets a dangerous precedent. If a major exchange like Coinbase can delist a cryptocurrency to promote its own product, the entire industry’s trust is at stake.”
BiT Global filed a lawsuit seeking $1 billion in damages and injunctive relief to prevent further harm to its business and the broader market.
Strategic Shift by Coinbase
The move also aligns with Coinbase’s broader strategy of shifting to more predictable revenue streams amid market volatility. The exchange focuses on stablecoin fees, staking rewards, and subscription services. Tom Duff Gordon, Coinbase’s Vice President of International Policy, commented recently on the need for a diversified revenue model.
This loosening of regulatory friction from Trump’s incoming administration may thus permit Coinbase to expand its U.S. operations while not sacrificing any ground in markets abroad.
Crypto Political Giveback
The company has been pretty much involved in political financing as well, donating significantly into Pro-Crypto advocacy groups, where its chief executive Brian Armstrong has contributed more than $1.3 million to bipartisan political action committees. Coinbase has pledged $25 million to Fairshake, a super PAC supporting pro-crypto candidates.
The case brings up questions of anti-competitive practices in the cryptocurrency market, underlining the need for clear regulations that will ensure a level playing field. The result of the lawsuit might be used as a precedent in how exchanges function within an evolving industry.
