On September 20, in response to the false news that Aave initiated a proposal to divest wBTC, Aave co-founder Stani Kulechov responded, Aave has not eliminated wBTC, and the proposal does not mean a withdrawal decision. On the same day, Kneupper Covey, a law firm based in Georgia, USA, stated on its official website that the cryptocurrency lending platform Sky (formerly MakerDAO)’s forced liquidation of Wrapped Bitcoin (wBTC) will harm the interests of users. It is collecting relevant victim information and providing legal assistance in class action lawsuits.
On the 20th, the day when Sky officially planned to divest wBTC, it was circulated that the DeFi platform Aave launched a proposal to divest wBTC, which once again set off a storm about wBTC. In response to this, Aave co-founder Stani Kulechov said, This is incorrect. Aave did not eliminate wBTC. This is a proposal to restrict wBTC proposed by one of the risk providers. Aave DAO is a real DAO. The proposal does not mean an exit decision, and this particular proposal is not about exit.
According to The Defiant, ACI founder Zeller and some community representatives opposed this radical proposal. They called for a more cautious response. Aave has not taken any wBTC-related parameters offline or adjusted them. Zeller even made it clear in the forum: Unless there are sufficient reasons, wBTC users have a legitimate right to use the Aave protocol, and ACI will not approve this proposal.
According to the website of the US law firm Kneupper Covey, the proposal initiated by BA Labs in the Sky community has no legitimate and objective basis, and even claims that there is no need for due diligence at all, but insists on delisting the existing collateral wBTC borrowed by users. This proposal not only caused serious concerns in the market, including users doubts about its true motives and the potential profits that liquidation would bring to Sky, but also forced liquidation to harm the interests of relevant users who hold opposing opinions.
Kneupper Covey specifically pointed out that given the high internationalization of the wBTC ecosystem, Sky’s unilateral plan to divest WBTC collateral in a very short period of time may cause uninformed users to be forced to face large-scale liquidations.
It is reported that Sky officially passed the proposal to divest $200 million of wBTC collateral asset exposure on the 20th, with about 12% of people abstaining from voting.
wBTC is an ERC-20 compatible cryptocurrency anchored to Bitcoin, with the goal of increasing Bitcoin liquidity and providing more application scenarios for the DeFi ecosystem. wBTC is managed by the decentralized organization WBTC DAO. BitGo, Kyber Network, and Ren proposed the idea of launching the token in 2019. The key advantage of WBTC is that it integrates Bitcoin with Ethereum compatible wallets, dApps, and smart contracts. Currently, wBTC has exceeded 150,000 pieces, with a value of more than $9 billion, making it the largest wrapped BTC token.
The news of Skys divestiture of wBTC has attracted the attention of the crypto industry, including users and wBTC competitors. On the page where Sky forum initiated proposals, there are many similar projects looking for attention and cooperation.
During this incident, MakerDAO changed its name to Sky and issued the stablecoin USDs. Sky co-founder and former Maker founder Rune Christensen pointed out that it is possible to design a freezing function that is more decentralized than centralized stablecoins. However, USDs and Sky have also been criticized for going further and further down the path of centralization and failing to reflect their values as a decentralized organization (DAO).
On September 12, the cryptocurrency exchange Coinbase officially entered the BTC wrapping track and launched Coinbase Wrapped BTC (cbBTC). However, the lack of centralization and reserve transparency has become the focus of controversy and questioning for cbBTC, and it has even been labeled the controversial Central Bank Bitcoin.
