Coinbase CEO Brian Armstrong and ETF experts swiftly responded to a rumor that began spreading uncontrollably regarding BlackRock and Coinbase. The rumor, which started circulating yesterday, claimed that Coinbase was not holding actual Bitcoin (BTC) on behalf of BlackRock but was instead issuing IOUs, and that both companies were suppressing Bitcoin's price.
In the crypto world, an IOU refers to a token representing a debt to another party. The rumor alleged that BlackRock, while receiving billions of dollars in investments for its ETF, was holding IOUs issued by Coinbase instead of real Bitcoin for those investments.
The rumor originated from a post by Justin Sun, CEO of Tron. Sun criticized Coinbaseâs recently launched cbBTC token, which is claimed to be backed 1:1 by Bitcoin. He pointed out that cbBTC lacks proof of reserves, has not been audited, and that the balance of any holder could be frozen at any time. Sun remarked, "This essentially means 'trust me.' Any U.S. court can confiscate your BTC. This is the ultimate example of central bank Bitcoin. Itâs a dark day for BTC.
