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BitGo CEO Mike Belshe Addresses wBTC Security Concerns Amid MakerDAO Changes
In a recent discussion, BitGo CEO Mike Belshe tackles security concerns surrounding wBTC amid significant changes within MakerDAO. Discover insights on how these developments impact the future of decentralized finance.
BitGo CEO Mike Belshe Addresses wBTC Safety Concerns
In a recent online discussion, BitGo CEO Mike Belshe emphasized the security of the bitcoin (BTC) that backs its wrapped Bitcoin (wBTC) offering. This token allows the largest cryptocurrency by market capitalization to be utilized across various blockchains beyond the original Bitcoin network.
During the X Spaces discussion, Belshe reassured participants that Justin Sun, the founder of Tron, does not have access to the asset keys held by the cryptocurrency custodian. This clarification comes in the wake of MakerDAO’s decision to eliminate its exposure to wBTC due to rising concerns. The worry stemmed from a proposal to shift custody to be jointly managed with BiT Global—an entity partially controlled by Sun—which could potentially centralize too much control within BiT Global.
Belshe explained that the custody keys would be divided between BitGo’s operations in the U.S. and Singapore, along with BiT Global. He stated, “There is no single party that has the ability to mint or steal from the underlying treasury.” He further noted that much of the community’s concern arose from a lack of understanding regarding the operational mechanics of the custody keys.
Moreover, Belshe clarified that Justin Sun is not an employee of BiT Global. He described the company as structured as a public holding entity in Hong Kong, which has a fiduciary duty to safeguard customer assets. He added, “Under local laws, no individual can own more than 20% of the company.”
On August 15, at 13:24 UTC, MakerDAO’s decision will come into effect, aiming to halt the organization’s reliance on its wBTC vaults for liquidity. This strategic move will prevent any further borrowing from these vaults, although it will not liquidate existing positions.
According to data from Dune, wBTC has remained stable, with no significant changes in the volume of burns or redemptions as users seek alternatives. Additionally, on Wednesday, cryptocurrency exchange Coinbase (COIN) hinted at potentially launching its own wrapped version of Bitcoin, which it plans to call cbBTC.