Key Takeaways:
Coinbase and BiT Global have resolved their legal disagreement concerning the delisting of BiT Global’s wrapped bitcoin (wBTC) token, concluding the lawsuit with prejudice. The legal action initially sought over $1 billion in damages, alleging that the delisting was advantageous for Coinbase’s competing token, cbBTC. Meanwhile, Coinbase has reported mixed results for the first quarter, noting a revenue increase but a staggering 94% drop in net income.
The resolution between Coinbase and BiT Global marks the end of a legal dispute that began when BiT Global filed a lawsuit in the Northern District of California last year following Coinbase’s removal of wBTC from its platform. Coinbase cited an “unacceptable risk” concerning Justin Sun, a Chinese-born crypto billionaire associated with wBTC since August 2023. Concerns arose regarding Sun’s potential control over the token after his partnership with BiT Global.
In response, BiT Global challenged the delisting, asserting that it was both unjustified and detrimental to the liquidity and market trust in wBTC. The company argued that the move effectively favored Coinbase’s newly launched cbBTC token, which debuted just two months before the wBTC delisting.
Under the terms of the settlement, BiT Global has confirmed its decision to dismiss the lawsuit “with prejudice,” effectively barring any future legal actions on this issue. Both firms have agreed to report their own legal expenses, although additional settlement details have not been made public.
BiT Global Sued Coinbase Over wBTC Delisting in California Court
As a co-custodian of Bitcoin reserves backing wBTC since August 2024, BiT Global emphasized the negative repercussions of the delisting in its suit. The legal complaint sought monetary damages exceeding $1 billion and requested an injunction to prevent further harm to BiT Global’s operations. With the dismissal of the suit now final, both companies can move forward without the burden of ongoing litigation.
Coinbase Q1 Revenue Climbs, But Profit Falls 94%
Coinbase has reported a mixed performance for the first quarter, with a 24% year-over-year revenue increase to $2 billion. However, this figure fell short of analyst expectations and marked a 10% decline compared to the previous quarter. The surge in transaction revenue reached $1.26 billion, while the subscription and services segment—encompassing staking and custodial offerings—rose by 37% to nearly $700 million, highlighting the firm’s attempts to diversify its income sources beyond trading.
Despite the revenue growth, net income plummeted by 94% to $66 million, largely due to markdowns on crypto holdings amid ongoing market volatility. Adjusted earnings were reported at $526.6 million, or $1.94 per share, a decrease from the previous year’s $2.53. Operating expenses saw a significant uptick of 51%, climbing to $1.3 billion, driven by aggressive marketing initiatives and asset write-downs.
The financial challenges were attributed to the unpredictable macroeconomic landscape and fluctuations within digital asset prices. Nevertheless, Coinbase recorded its second-highest monthly user count, with Chief Financial Officer Alesia Haas noting an increase in engagement across its non-trading services.
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