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Popular Crypto entrepreneur Justin Sun showed his disappointment with the cbBTC concept and called it the central bank Bitcoin
Justin Sun is a popular crypto entrepreneur. He is responsible for the origin of many successful crypto projects, e.g., Tron blockchain, Sun coin, BTT coin, JST coin. He is also the owner of multiple decentralised and some centralised crypto exchanges, e.g., Poloniex, Huobi Global (now HTX), Sunswap.
On 12 Sep 2024, Justin Sun took to X (formerly Twitter) to express his disappointment with Coinbase’s cbBTC.
Justin noted that cbBTC lacks Proof of Reserves, has no audits, and can freeze anyone’s balance at any time. He also asserted that any U.S. government subpoena could seize all BTC or cbBTC. There’s no better representation of central bank Bitcoin than cbBTC.
#cbbtc lacks Proof of Reserve, no audits, and can freeze anyone's balance anytime. Essentially, it’s just 'trust me.' Any U.S. government subpoena could seize all your BTC. There’s no better representation of central bank Bitcoin than this. It’s a dark day for BTC.
— H.E. Justin Sun🌞(hiring) (@justinsuntron) September 12, 2024A Bitcoin advocate noticed this tweet from Justin and said that cbBTC is now a tool for Coinbase to transfer any amount of Bitcoin to BlackRock. He indirectly stated that BlackRock is going to manipulate the trade price of Bitcoin.
I told everyone I went through the chain – I mean it’s a public ledger literally anyone can do it – Coinbase are writing IOUs for Blackrock.
Now everyone is waking up and hopefully Coinbase has a bank run.
Baldilocks is anti bitcoin. pic.twitter.com/GsnTSg0y6Q
In response, Coinbase CEO Brian Armstrong explained that all ETF mints and burns by Coinbase processes are ultimately settled on-chain. He added that institutional clients trade ETF-related financing and OTC options before trades are settled on-chain, while post-on-chain trade actually completes later within 1 business day, which is the standard norm for all institutional clients. For further clarification, Armstrong suggested getting detailed information through an audit report by Deloitte.
At the end, Armstrong admitted that cbBTC is a centralised custodian against Bitcoin. However, he also emphasised that people trust Coinbase’s centralised custodians to store the underlying BTC, indirectly highlighting Coinbase’s strong reputation & emphasised that Coinbase never claimed cbBTC decentralised form of Bitcoin.
Baldilocks here.
Not sure what this is all about TBH. All ETF mints and burns we process are ultimately settled onchain. Institutional clients have trade financing and OTC options before trades are settled onchain. This is the norm for all our institutional clients. All funds…
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