Coinbase appears poised to enter the packaged Bitcoin market following recent revelations from the company.
Coinbase’s official X account (formerly Twitter) will be released on August 13 teased an upcoming product with a message that says “cbBTC” followed by “coming soon.” Head of Corporate and Business Development at Coinbase Ventures, Shan Aggarwal, commentedit was “hard to keep this a secret.”
While details about the product remain scarce, Jesse Pollak, lead developer of Coinbase’s Base network, has hinted at plans to create a substantial Bitcoin economy on the Ethereum Layer-2 network.
He declared:
“To say it out loud: I love bitcoin, [I’m] so grateful for his role [in] we are going to kickstart crypto, and we are going to build a massive bitcoin economy on Base.”
Dan Elitzer, co-founder of venture capital firm Nascent, suggested that cbBTC would be strategically crucial for the crypto company. He speculated that the new product could surpass BitGo’s current Wrapped Bitcoin (WBTC) offering within six months of launch.
According to him:
“cbBTC was inevitable and super strategic for Coinbase. Honestly, I’m surprised they didn’t ship this years ago.”
This sentiment was echoed by DCinvestor, a pseudonymous crypto investor believes Coinbase could use cbBTC to convert its Bitcoin holders into Base and Ethereum users.
WBTC issues
Coinbase’s announcement about cbBTC comes amid recent controversy surrounding Tron founder Justin Sun’s involvement with BitGo’s WBTC.
On August 9, BitGo announced plans to transfer management of WBTC to a new joint venture involving itself, Hong Kong-based investment manager BiT Global and Sun. This decision caused a stir significant backlash within the crypto community, with concerns mainly focused on Sun’s involvement.
Despite these concerns, BitGo CEO Mike Belshe and Sun have maintained that the crypto entrepreneur’s role in the new venture was purely strategic.
Sun declared:
“The minting process is fully managed by the custodians Bitglobal and Bitgo, following the same procedures as before. Simply put: Bitglobal and Bitgo will not sign unverified transactions. The keys are still secured using the same Bitgo cold wallet technology and offline keys, with backups in multiple countries and regions.”
Nevertheless, Elitzer criticized the move: suggestive that no experienced DeFi user or risk manager influenced by Sun would want to maintain exposure to WBTC.
He also noted that this shift in management could lead to significant disruptions, causing several protocols and platforms to support alternative bridged BTC solutions.