Market Shakeup: The Flash Crash
On November 23, Wrapped Bitcoin (WBTC) faced a stunning flash crash on Binance, diving to around $5,200—a level never seen before. This unexpected downturn stemmed from a glitch in the trading system, an all-too-common hiccup that can trigger such drastic price shifts. Before the crash, WBTC was trading at stable levels close to $98,000. However, by the day’s end, it made a surprising recovery, closing at approximately $97,000, where it has largely remained since.Coinbase Delisting Announcement
This significant drop came shortly after Coinbase announced its decision to remove Wrapped Bitcoin from its exchange, effective December 19, 2024. The exchange stated that it regularly reviews assets to ensure they meet their listing criteria. However, they reassured users that their WBTC holdings would still be available for withdrawal even after the delisting.Backlash and Community Response
In the backdrop of this situation, BiT Global, the custodian managing WBTC, pointed out that Coinbase’s move seems to be a strategic attempt to bolster its own Bitcoin product—cbBTC. Launched in September 2024, cbBTC emerged amid ongoing tensions surrounding WBTC’s shift to a multi-jurisdictional custodial setup. This transition raised eyebrows in the crypto community, especially due to the involvement of Justin Sun, the founder of Tron. As scrutiny intensified, it led to considerable backlash including a vote within the Sky community to discard WBTC as collateral on their platform. The unfolding events around WBTC and Coinbase illustrate the complex dynamics of the cryptocurrency market, where technical issues and strategic decisions can dramatically influence prices and community sentiment. “`htmlSource: Cointelegraph.com
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