Sky Protocol, formerly known as #MakerDAO, has proposed removing Wrapped Bitcoin ( $WBTC ) as collateral from its ecosystem.

The move comes after growing concerns over#Tronfounder Justin Sun’s relationship with WBTC’s custodian. The proposal outlines a phased approach to removing WBTC from the platform, starting with a Governance Vote scheduled for September 26, 2024.

The move stems primarily from risk management concerns raised by BA Labs, a key governance voice at Sky Protocol. The company’s analysis points to several issues 👇🏼

- There is evidence that Sun or its affiliates control BitGlobal, the entity responsible for custodianship of $WBTC. This connection raises red flags given Sun’s controversial history with other custodians and stablecoins.

- BA Labs points to a history of obfuscation and lack of transparency in ventures affiliated with Sun. They argue that the risk associated with holding#WBTCis too high, given the potential negative impact on users and the integrity of the asset.