Coinbase Denies Rumors of Special Borrowing Privileges for BlackRock's Bitcoin ETF
CryptoNewsTerminal Staff15 Sep, 2024
Coinbase Denies Rumors of Special Borrowing Privileges for BlackRock's Bitcoin ETF
Coinbase, the leading cryptocurrency exchange, has refuted allegations that it provided special borrowing privileges to BlackRock, the world's largest asset manager. Rumors surfaced that BlackRock was given special treatment, allowing it to create short positions on Bitcoin without holding an equal amount of the asset. Coinbase CEO Brian Armstrong dismissed these claims, stating that the company does not disclose specific client arrangements, but it is audited annually by a reputable accounting firm. He also clarified that cbBTC, a wrapped Bitcoin asset launched by Coinbase, relies on trust in a centralized custodian for asset custody. Contrary to these denials, Justin Sun, the founder of Tron, has raised concerns about cbBTC's lack of transparency and reserve proof. He claims it could be susceptible to government seizure or freezing of balances. These allegations and counterclaims highlight the ongoing debate about transparency and regulatory oversight in the cryptocurrency industry. As institutional investors and large corporations enter the space, it becomes crucial to ensure fair practices and protect investor interests.
