BiT Global, a crypto custody firm tied to entrepreneur Justin Sun, has voluntarily dismissed its lawsuit against Coinbase over the delisting of Wrapped Bitcoin (WBTC).
The move ends a months-long legal dispute that spotlighted growing tensions between centralized exchanges and token custodians as control over key infrastructure becomes increasingly contested.
Filed on June 6 in the US District Court for the Northern District of California, the joint stipulation of dismissal closes the case with prejudice, which prevents it from being refiled.
Both parties agreed to cover their own legal fees and did not disclose settlement terms, if any.
Dispute over custody shift
BiT Global initially filed suit in December, weeks after Coinbase announced that WBTC would be delisted from its platform. The exchange said the token no longer met its listing standards, citing governance and risk concerns.
Days earlier, BitGo, the primary custodian for WBTC, had revealed a new partnership with BiT Global to diversify the token’s Bitcoin reserve holdings outside the US.
BiT Global was set to serve as a co-custodian, with reserves partially relocated to Hong Kong. The move sparked criticism in the crypto industry due to BiT Global’s known ties to Sun, who was facing regulatory probes in the US at the time.
Coinbase argued that allowing WBTC to fall under Sun-affiliated control posed an “unacceptable risk” to user security and market integrity.
BiT Global, in turn, alleged that Coinbase’s rationale masked a conflict of interest. The lawsuit accused the exchange of using the delisting to undermine a competing product, WBTC, in favor of its own wrapped Bitcoin token, cbBTC, which Coinbase launched shortly afterward.
The firm described the delisting as a “cash grab” designed to boost cbBTC’s market share by sidelining its main rival.
Legal setback preceded withdrawal
The case suffered a major blow in March when Judge Araceli Martinez-Olguín denied BiT Global’s motion for a preliminary injunction, ruling that the firm had not demonstrated imminent harm from the delisting.
By May, during a hearing, the judge signaled that she was inclined to grant Coinbase’s motion to dismiss the case entirely, citing a lack of legal grounds to proceed.
With the court leaning heavily in Coinbase’s favor, BiT Global opted to drop the case before a formal ruling was issued. The company has not provided a public explanation for the withdrawal and did not respond to media inquiries.
Coinbase, for its part, reaffirmed its stance following the dismissal. The exchange’s Chief Legal Officer Paul Grewal said in a social media post on June 9:
“We have zero plans to relist WBTC.”
The case highlighted how custody decisions and token listing policies are becoming flashpoints in an industry still lacking unified regulatory oversight. While WBTC remains the dominant wrapped Bitcoin token by market cap, Coinbase’s cbBTC has grown rapidly in adoption since its launch.
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