Whale Amasses $118M in Wrapped Bitcoin Amidst Ongoing Ownership Controversy

• A whale wallet amassed 1,953 WBTC ($118M), sparking concerns amid ongoing ownership changes.
• MakerDAO prohibited new WBTC borrowing following ownership shifts.
• Coinbase hinted at launching a new wrapped Bitcoin token, “cbBTC.”

The Bitcoin community is concerned about a sizable accumulation of Wrapped Bitcoin (WBTC) by an unknown wallet. After lying dormant for some time, the wallet has now accumulated 1,953 WBTC, or roughly $118 million. The ownership and control of the Wrapped Bitcoin token are a topic of increasing debate at the time of this development.

Developments Spark Industry Discussions

According to a report by blockchain analytics company Lookonchain the whale address bought 347 WBTC on August 19,. At current prices, that amount is worth $16 million. The wallet’s current holdings, which have been gradually increasing over the previous few weeks, are increased by this purchase. The congruence of these acquisitions with notable changes in WBTC management has given rise to conjecture.

Notably, controversy has surrounded the Wrapped Bitcoin token, which BitGo initially managed, since its announcement on August 9. BitGo disclosed intentions to hand over WBTC to a joint venture. This project involves Justin Sun, the founder of Tron, and BiT Global, an investment manager with headquarters in Hong Kong. The cryptocurrency community is now paying more attention to this move and debating WBTC’s future.

MakerDAO and Aave Respond to Ownership Changes

Several players in the industry have reacted to the ownership changes. Block Analitica, a crypto risk management company, made a proposal on MakerDAO’s governance forum on August 10. According to the proposal, MakerDAO ought to stop taking on new Bitcoin debts and refrain from borrowing money secured by Bitcoin. On August 16, MakerDAO approved and implemented this proposal, which forbade the borrowing of WBTC on the Sparklend platform.

Furthermore, it is reported that Aave, the massive lending company, is getting ready to present a substitute for borrowing and lending WBTC. As a potential substitute for WBTC, Aave intends to offer Threshold Network’s TBTC, an alternative wrapped Bitcoin token. These changes imply that, in the face of the ongoing dispute over WBTC ownership, there is an increasing interest in exploring other options.

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Coinbase Teases Potential Entry into Wrapped Bitcoin Market

Additionally, U.S. cryptocurrency exchange Coinbase made a suggestion that, in the wake of BitGo’s contentious decision, a new product called “cbBTC” might be introduced. This action has sparked rumours that Coinbase may be getting ready to introduce a wrapped Bitcoin token of its own. 

Moreover, the adoption of Bitcoin-native decentralized finance (DeFi) could be greatly increased by the introduction of cbBTC, according to Rena Shah, the Chief Operating Officer of the Bitcoin software company Trust Machines. Shah claims that there is a huge opportunity to onboard new users into the Bitcoin DeFi ecosystem thanks to Coinbase’s large user base.