Mitrade Insights is dedicated to providing investors with rich, timely and most valuable financial information to help investors grasp the market situation and find timely trading opportunities.

2021

Best News & Analysis Provider

FxDailyInfo

2022

Best Forex Educational Resources Global

International Business Magazine

Insights

News

Cryptocurrencies

BitGo’s New WBTC Custody Plan Draws Scrutiny Over Justin Sun’s Role

Source Beincrypto

BitGo, a leading crypto custodial platform, will shift its Wrapped Bitcoin (WBTC) to a new multi-jurisdictional and multi-institutional custody model. This decision has raised concerns in the crypto community, particularly because of the involvement of Justin Sun, founder of the TRON blockchain.

On August 9, BitGo revealed a 60-day transition period. The company plans to expand its custodial locations to include Hong Kong and Singapore.

Sun’s Role in WBTC Custody Sparks Concerns

In response to this development, prominent DeFi platform MakerDAO has begun assessing the potential risks associated with BitGo’s new WBTC custody strategy. The MakerDAO community is considering a proposal that could effectively reduce all active WBTC debts on the network to zero.

The proposal highlights fears that this new move might grant Sun significant influence over WBTC. Additionally, it references past issues with Sun’s interactions with other crypto projects, such as TUSD and Huobi’s USDT reserves, which were plagued by operational and transparency problems.

The broader crypto community has echoed these concerns. Some stakeholders worried that Sun could exploit his influence to mint excessive WBTC or manipulate Proof-of-Reserve data.

“BitGo partnering with Justin Sun for WBTC custody is up there with the most insane business decision I’ve ever seen,” Bitcoin Magazine writer Alex Bergeron stated.

Read more: What Is Bitcoin? A Guide to the Original Cryptocurrency

WBTC Balance on Ethereum. Source: WBTC.Network

Meanwhile, BitGo CEO Mike Belshe has countered these concerns. He asserted that the platform’s security architecture prevents any form of manipulation. He also emphasized that BitGo will not authorize any minting without a corresponding BTC deposit.

“We recognize the community wants to know about JS involvement in anything, even though he doesn’t have the ability to move funds. That’s why we made sure to be very clear about his name,” Belshe stated.

The BitGO CEO further urged the community to conduct thorough due diligence before drawing conclusions. According to him, while Sun is involved in the project, he lacks the authority to move funds. Belshe also stated that the WBTC website will remain operational, providing near real-time proof of reserves.

Read more: Wrapped Bitcoin (WBTC) Price Prediction 2024, 2025, 2026, 2027, 2028

Sun, for his part, has clarified that his role with WBTC is purely strategic. He assured that he does not control the private keys to the WBTC reserves and cannot access the BTC reserves as rumored. Sun emphasized that his involvement aims to bolster decentralization, security protocols, and safety, reinforcing the critical role of the digital asset in the DeFi ecosystem.

“In simple terms, Bitglobal and Bitgo will not sign any unaudited transactions. The keys are still safeguarded using the same Bitgo cold wallet technology and offline keys, with backups in multiple countries and regions,” Sun added.

Disclaimer: For information purposes only. Past performance is not indicative of future results.

Recommended Articles

US August CPI lands tonight: after a 5.4% PPI shock, will the Fed hike on September 16?US August PPI came in at 5.4% year-on-year, above the 5.3% consensus, with core PPI at 4.6%. Traders have pushed the odds of a 25bp Fed hike on September 15-16 to around 70%. Tonight's CPI is the last major inflation print before the decision — here is the full calendar, the consensus numbers, and what a hot versus cool reading would mean for the dollar, yields, gold and stocks.

Author Irene Q.

Sep 11, Fri

US August PPI came in at 5.4% year-on-year, above the 5.3% consensus, with core PPI at 4.6%. Traders have pushed the odds of a 25bp Fed hike on September 15-16 to around 70%. Tonight's CPI is the last major inflation print before the decision — here is the full calendar, the consensus numbers, and what a hot versus cool reading would mean for the dollar, yields, gold and stocks.

Brent tests $108 as a key export pipeline stays shut — can the rally clear $110?Brent crude rose 2.55% to $106.97 and WTI 2.32% to $102.30 as a major regional export pipeline remained offline with no restart timeline. Front-month backwardation has widened to $5.53 from $3.84 a week ago, European gas is at its highest since December 2022, and one analyst sees $119.48 if talks stall.

Author Irene Q.

Sep 14, Mon

Brent crude rose 2.55% to $106.97 and WTI 2.32% to $102.30 as a major regional export pipeline remained offline with no restart timeline. Front-month backwardation has widened to $5.53 from $3.84 a week ago, European gas is at its highest since December 2022, and one analyst sees $119.48 if talks stall.

Fed hike odds near 90% into Wednesday's decision — how to trade the dollar, gold and the S&P 500 A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.

Author Suzie

Sep 14, Mon

A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.

Gold falls below $4,300 as higher US yields bolster Fed rate hike bets Gold price (XAU/USD) tumbles to near $4,295 during the early Asian session on Tuesday. The precious metal faces some selling pressure as rising bond yields and surging energy prices strengthen expectations that the US Federal Reserve (Fed) will raise interest rates this week.

Author FXStreet

Yesterday 01: 23

Gold price (XAU/USD) tumbles to near $4,295 during the early Asian session on Tuesday. The precious metal faces some selling pressure as rising bond yields and surging energy prices strengthen expectations that the US Federal Reserve (Fed) will raise interest rates this week.

【Daily Brief】10-year Treasury yield briefly tops 5%, S&P 500 slips to 7,602 and the dollar firms at 99.3 as the Fed's decision eve begins The 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.

Author Irene Q.

Yesterday 08: 16

The 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.

Popular Symbols