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- Coinbase CEO Armstrong and experts debunk rumors of Bitcoin IOUs, confirming on-chain transparency and dismissing claims of market manipulation.
- Both Coinbase and BlackRock are under heavy scrutiny, ensuring no risk of misconduct, as institutional transactions remain fully auditable and transparent.
Following the development, Coinbase denied issuing Bitcoin IOUs to BlackRock, stating all transactions are on-chain and fully auditable. As CNF reported, there was no real evidence supporting claims that Coinbase facilitated market manipulation with BlackRock.
As of today, referring to recent rumors circulating online, Coinbase CEO Brian Armstrong and industry insiders quickly dismissed claims that Coinbase had issued Bitcoin IOUs. The accusations began when crypto analyst Tyler Durden accused Coinbase of allowing BlackRock to borrow Bitcoin without posting any collateral, potentially manipulating the market for profit.
This was followed by a post from Justin Sun, founder of Tron, criticizing Coinbase’s cbBTC product for lacking Proof of Reserves and audit transparency.
#cbbtc lacks Proof of Reserve, no audits, and can freeze anyone's balance anytime. Essentially, it’s just 'trust me.' Any U.S. government subpoena could seize all your BTC. There’s no better representation of central bank Bitcoin than this. It’s a dark day for BTC.
— H.E. Justin Sun🌞(hiring) (@justinsuntron) September 12, 2024
Armstrong and Analysts Respond to Allegations
In response, Armstrong clarified that all ETF-related transactions, including minting and burning, are settled on-chain within one business day. He also mentioned that institutional clients can access trade financing and over-the-counter options before full settlement.
Durden later retracted his tweet after this explanation, while Bloomberg ETF analysts James Seyffart and Eric Balchunas labeled the accusations as baseless conspiracy theories.
Support from BlackRock and ETF Experts and BTC Price
Previously, CNF highlighted that Coinbase’s CEO and Bloomberg analysts rejected these claims, believing the accuser had no understanding of how ETFs work. Furthermore, the Bitcoin community was criticized for blaming ETFs for market pressure, arguing that BlackRock and Coinbase take their roles seriously and would not risk misconduct, especially with the level of scrutiny they face.
Despite the BlackRock Bitcoin IOU rumors, at the time of writing, Bitcoin (BTC) is trading at $60,170.27, with an increase of 2.41% in the past day and 2.39% in the past week.
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