Since Coinbase launched cbBTC on the 12th, it has quickly become the third largest encapsulated Bitcoin. However, Tron founder Justin Sun tweeted last night: "cbBTC is not BTC," which aroused the community's concern about its security. (Previous summary: Aave founder: The proposal to divest wBTC does not mean exit, Sky’s abandonment of wBTC may harm the DeFi ecosystem) (Background supplement: BTC Block Gathering” How do top VCs and Plan B Network view the BTC track and emerging market potential? ) Since Coinbase, the largest cryptocurrency exchange in the United States, launched cbBTC on the 12th of this month, it has quickly received market orders. In just one week, it has become the third largest wrapped BTC, with a circulation of 2,944 and a total market value of 180 million. USD, surpassing tokens issued 4 years ago such as HBTC and renBTC. cbBTC is fully secured by Bitcoins hosted by Coinbase, and initially supports Base and Ethereum. At the recently concluded Solana Breakpoint event, Coinbase announced that it will expand cbBTC to Solana (the specific time has yet to be officially announced). Although cbBTC is not decentralized and Coinbase has not yet disclosed the address where it hosts Bitcoin, it is still generally paid for by the market due to Coinbase's good reputation. However, Tron founder Justin Sun tweeted yesterday (13th) night: "cbBTC is not BTC", triggering widespread discussion in the community. Netizen warns cbBTC users of security concerns Justin Sun’s comment was a repost of a netizen’s interpretation of Coinbase’s cbBTC terms. The netizen raised the alarm, citing the following cbBTC user terms: Under the terms of this agreement, cbBTC holders have an ownership interest in the Bitcoins hosted by Coinbase. In the event of a shortage of Bitcoins hosted by Coinbase, Coinbase’s liability to a cbBTC holder will be limited to that holder’s pro-rata portion of the shortage. The netizen interpreted that if Coinbase loses the Bitcoins that support cbBTC for some reason, the holders can only distribute the remaining Bitcoins proportionally and cannot receive full compensation, which raises its concerns about the safety of cbBTC users. However, Cointelegraph senior writer @IntrinsicDeFi explained that this is not what this clause really means. The correct interpretation is: Coinbase will only compensate the holder for the lost Bitcoin, and only the corresponding part of cbBTC, but will not be responsible for other losses.For example, if a user mortgages cbBTC for a loan and the loan is liquidated due to a loophole, Coinbase will not compensate for the liquidation losses. Coinbase’s general counsel later confirmed @IntrinsicDeFi’s interpretation. He further explained: This is a basic liability limitation clause: Coinbase’s liability is limited to the lost Bitcoins and will not be responsible for other additional losses. In addition, the custody relationship between Coinbase and the customer is clearly stated in the terms and refers to the relevant clause 9.1.5. BlackRock asked Coinbase to speed up the custodial BTC withdrawal process. On the other hand, Coinbase has recently caused community concerns about its sale of "paper BTC" (Paper BTC, which refers to synthetic financial products without actual Bitcoin support) to ETF issuers. In this regard, according to a tweet from Bitcoin Magazine, BlackRock, one of the issuers of Bitcoin spot ETFs in the United States, has modified the Bitcoin spot ETF custody agreement with Coinbase, requiring the withdrawal time of Bitcoin to be shortened. Under the agreement, Coinbase must withdraw Bitcoin from its escrow account to a public address within 12 hours of receiving the instruction. This change shows that BlackRock attaches great importance to Bitcoin’s liquidity and transparency. Quick withdrawal to a public address not only improves transparency and security, but also reduces custody risks. In response to this matter, Justin Sun also seized the opportunity to comment, saying: "Even BlackRock will not be stupid; they said: What we want is actual Bitcoin." Currently, Justin Sun is afraid of entering the largest encapsulated Bitcoin WBTC, Continuing to cause a crisis of trust, SKY (formerly MakerDAO) will remove WBTC from its ecosystem starting from October 3. NEW: BlackRock amended its spot#BitcoinETF custody agreement with Coinbase to improve withdrawal times. Coinbase must now process BTC withdrawals to a public address within 12 hours of receiving instruction pic.twitter.com/JfEG8MPKZu — Bitcoin Magazine (@BitcoinMagazine) September 23 , 2024 Related Reports Bitcoin keeps falling, who is selling BTC? Bitcoin RSI indicator triggers a bull market signal. Analyst: BTC will see $85,000 at the end of the year. Treat the community autonomy proposal rationally. Aave: There is no plan to spin off wBTC. The proposal is just the beginning of community autonomy. Germany requires speeding up the withdrawal of escrow Bitcoins> This article was first published in BlockTempo, the most influential blockchain news media.

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