Coinbase teases 'cbBTC’ days after BitGo Wrapped Bitcoin controversy

Speculators think the post refers to Coinbase’s own wrapped Bitcoin product, which will potentially be launched on its layer-2 network Base.

Coinbase has just teased the possible launch of a new product called “cbBTC” — with many commentators speculating that the United States-based crypto exchange is launching its own wrapped Bitcoin token.

In an Aug. 13 post to X, the official Coinbase account said just one word: “cbBTC” before adding “coming soon” in a follow-up comment to the original post. 

In another X post an hour later, Jesse Pollak — the head of Coinbases’ layer-2 network Base — expressed his love for Bitcoin (BTC), adding that Base would build a “massive Bitcoin economy” on its network.

The cryptic posts about cbBTC from Coinbase and Pollak come just days after controversy involving BitGo — the team behind Wrapped Bitcoin (WBTC) — and Tron Founder Justin Sun.

On Aug. 9, BitGo announced plans to transfer control over WBTC to a joint venture made up of itself, Hong Kong-based investment manager BiT Global, and Sun’s Tron ecosystem.

Many within the decentralized finance (DeFi) ecosystem were concerned with Sun’s involvement and called for WBTC support to be pulled from major protocols.

Related: Why is Bitcoin DeFi blooming? Developers share their insights

Crypto risk management firm Block Analitica Labs (BA Labs) published an Aug. 10 proposal on MakeDAO’s governance forum requesting the protocol to close all new wBTC debts and prevent new borrowing against WBTC collateral.

“We find that Sun’s involvement as a controlling interest in the new WBTC joint venture presents an unacceptable level of risk,” BA Labs concluded.

BitGo CEO Matt Belshe brushed aside any security concerns, saying the controversy was a “reaction to the Justin Sun name” rather than a proper assessment of the facts.

Belshe clarified that the underlying WBTC security protocols are not in danger, and they would still remain the “same as what you have today,” regardless of Sun’s involvement.

Sun also addressed the controversy in an Aug. 11 post to X, saying there had been “no changes to WBTC,” and his involvement did not involve direct access to funds.