Coinbase will disable Wrapped Bitcoin (WBTC) trading pairs from its exchange and Prime platforms on Dec. 19, citing the token’s failure to meet its listing standards, according to a Nov. 19 announcement.
Users will still be able to withdraw their funds past this date.
Coinbase did not specify how WBTC falls below its listing standards, the decision comes three months after WBTC issuer BitGo announced a multi-jurisdictional custody model to boost its global expansion plan.Â
BitGo transferred WBTC’s control to a joint venture with BiT Global, which is tied to TRON founder Justin Sun. As a result, the community showed concern over how much influence Sun would have over WBTC.
This change prompted DeFi protocols such as Sky (former Maker) to vote for WBTC removal as collateral for its stablecoin DAI.
Some firms, including Coinbase, have stepped in to cover the gap left by WBTC in the synthetic Bitcoin (BTC) market. The exchange recently launched the Coinbase BTC (cbBTC).
Challenging dominance
According to a Kaiko report, Coinbase’s cbBTC is making notable inroads in adoption on the leading money market, Aave. Since early October, cbBTC’s share of Aave’s synthetic Bitcoin market has surged from 3% to 17%, marking a 5x increase in just weeks.
Launched in September, cbBTC has already reached a market cap of $1.3 billion, capturing nearly 10% of the market dominated by WBTC.
Its rapid ascent reflects its appeal as a diversifier to WBTC and the impact of targeted incentives, such as Aave’s October Merit reward program, which promotes cbBTC deposits and USD Coin (USDC) borrowing.
Unlike stablecoins, wrapped assets like WBTC and cbBTC are not pegged to BTC, trading at values that can deviate from their underlying asset due to market conditions. Since August, WBTC has consistently traded at a discount versus BTC, marking its steepest divergence since the FTX collapse.
The report noted that as WBTC navigates mounting scrutiny, cbBTC’s momentum signals a potential shift in the competitive landscape for wrapped Bitcoin assets.
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