Coinbase CEO Brian Armstrong Hits Back at Justin Sun After Tron Founder Calls cbBTC Launch A “Dark Day for Bitcoin”

Coinbase
CEO
Brian
Armstrong
hit
back
at
Tron
founder
Justin
Sun,
who
called
the
launch
of
Coinbase’s
new
cbBTC
token
a
“dark
day
for
Bitcoin.”

Sun
criticized
cbBTC
in
a

Sept.
12
post
on
X
for
lacking
Proof
of
Reserves,
audits,
and
having
the
potential
to
freeze
user
balances.
He
derided
it
as
a
“trust
me”
system
and
warned
that
a
US
government
subpoena
could
allow
authorities
to
seize
the
underlying
Bitcoin.

“There’s
no
better
representation
of
central
bank
Bitcoin
than
this,”
he
said.

Armstrong
responded
in
a

Sept.
14
post
on
X,
defending
Coinbase’s
transparency
about
cbBTC
and
its
centralized
nature.
He
pointed
out
that
Coinbase
has
always
been
clear
about
being
the
custodian
of
the
underlying
Bitcoin.

“Not
sure
what
this
is
all
about,
TBH,”
he
said.
”As
for
cbBTC
yes
you’re
trusting
a
centralized
custodian
to
store
the
underlying
BTC
–
we’ve
never
claimed
otherwise.”

Coinbase
Believes
cbBTC
Will
Grant
Access
To
DeFi
For
“Millions
Of
BTC
Holders”

From
a
technical
perspective,
cbBTC
will
serve
as
a
wrapped
version
of
Bitcoin
that
will
compete
with


Wrapped
Bitcoin
(WBTC),
which
currently
has
a
market
cap
of
over
$8.9
billion.

Coinbase
announced
the
launch
of
cbBTC
on
Sept.
12.
The
company
said
that
the
token
follows
the
ERC-20
standard
and
is
backed
1:1
by
BTC
that
is
held
by
Coinbase.

According
to
the
announcement,
the
new
crypto
will
enable
“millions
of
BTC
holders”
to
securely
access
DeFi
(decentralized
finance)
applications
hosted
on
the
layer-2


Base

network.

cbBTC
is
onchain.

cbBTC
is
an
ERC20
token
that
is
backed
1:1
by
Bitcoin
(BTC)
held
by
Coinbase.

This
means
millions
of
BTC
holders
can
now
securely
access
DeFi
apps
on

@base
and
Ethereum
ecosystems—with
more
chains
coming
soon.

Here’s
what
you
need
to
know
↓

pic.twitter.com/nF8mF3JGms

—
Coinbase
????️
(@coinbase)

September
12,
2024

Armstrong
Addresses
ETF
IOU
Rumors

Amid
Sun’s


cbBTC

remarks,
rumors
that
Coinbase
is
writing
Bitcoin
IOUs
for
BlackRock
and
suppressing
the
market
leader’s
price
have
also
started
to
circulate
on
X.

Whatever
Coinbase
is
or
isn’t
doing,
rest
assured
the
ETFs
100%
own
underlying
btc….

It’s
real.
And
it’s
spectacular.

That
simple.
Period.
End
of
story.

Heard
same
thing
back
in
the
day
w/
physical
gold
ETFs.

Anyone
perpetuating
this
stuff
doesn’t
understand
how
ETFs
work.

https://t.co/1msZXUbevn

—
Nate
Geraci
(@NateGeraci)

September
14,
2024

Armstrong
addressed
these
concerns
in
his
response
to
Sun
as
well,
and
said
that
all
of
the
ETF
(exchange-traded
fund)
mints
and
burns
Coinbase
processes
are
“ultimately
settled
onchain.”

Institutional
clients
do,
however,
have
trade
financing
and
OTC
(over-the-counter)
options
before
their
trades
are
settled
on
the
blockchain
within
1
business
day.

Armstrong
said
that
anyone
who
wants
to
see
audits
of
the
exchange’s
transactions
can
refer
to
the
annual
audits
conducted
by
the
reputable
accounting
firm
Deloitte.

He
went
on
to
say
that
it’s
not
Coinbase’s
place
to
share
the
addresses
that
belong
to
their
institutional
clients,
who
he
doubts
will
“want
people
dusting
all
their
addresses.”

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