cbBTC is Trust Me Bro
Tron founder Justin Sun has put Coinbase's Ethereum and Base based Wrapped Bitcoin cbBTC in the "trust me" category. Justin claims that cbBTC has no proof-of-reserve (PoR). Justin has also raised the possibility of risks such as government intervention.
Hardly anyone believes Justin Sun, but that claim has rung the alarm bells about Coinbase.
Source: Justin Sun's posts
Yes Trust Me, says cbBTC
Coinbase CEO Brain Armstrong has hit back at Justin, claiming that Coinbase's reserves are audited by Deloitte. Armstrong has also emphasised the ETF settlement for Coinbase's credibility.
Currently it cannot certify Coinbase's reserves on cbBTC, which is natural to doubt.
Source: Armstrong’s Post
My Point: There is potential danger in cbBTC
cbBTC is a Wrapped Bitcoin based on 1:1 BTC reserve, whose holder has the same value to Coinbase as a bitcoin holder holding paper currency (Fiat) issued by the FED/central bank. With cbBTC, Coinbase will become the FED of bitcoin, and economic freedom will cease to exist. Coinbase will continue to mine cbBTC at will, just like dollars, which have no real basis. Government intervention cannot be ruled out at all if there is competition with the dollar.
In conclusion, cbBTC goes against the basic structure of Bitcoin established by Satoshi.
