BitGo CEO Dismisses Concerns Over Justin Sun’s Involvement in Wrapped Bitcoin
Mike Belshe, CEO of BitGo, has responded to growing concerns surrounding Justin Sun’s involvement in Wrapped Bitcoin (WBTC), asserting that Sun’s role will not compromise the security or transparency of the platform.
BitGo Diversifies Custodial Jurisdictions
The concerns emerged after BitGo, a prominent cryptocurrency custody platform, announced on Aug. 9 that it was diversifying the custodial jurisdictions for the Bitcoin (BTC) underlying WBTC. Previously, these assets were held exclusively in the United States. Now, they are spread across multiple global locations, including Singapore and Hong Kong.
This strategic move, which involves a joint venture with Hong Kong-based BiT Global and a partnership with the Tron ecosystem led by Justin Sun, has sparked debate within the crypto community. Critics, particularly those from risk management firm Block Analitica Labs (BA Labs), have raised alarms, pointing to what they describe as “elevated levels of risk” associated with Sun’s involvement.
BA Labs highlighted previous controversies tied to crypto projects linked to Sun, suggesting that his participation could lead to operational and transparency issues. In response, the firm has proposed closing all new WBTC debts and preventing further borrowing against WBTC collateral in an upcoming executive vote scheduled for Aug. 12.
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Addressing the issue, Belshe dismissed the concerns as largely unfounded, characterizing them as more of a reaction to Sun’s reputation than to any substantive risk. Belshe assured stakeholders that the security protocols underpinning WBTC remain intact, unchanged, and robust.
“The controversy is more a reaction to the Justin Sun name than to facts,” Belshe stated. “BitGo is still co-signing all transactions using the same technology it always had; BitGo simply will not sign a transaction that does not have the corresponding mint BTC deposit or burn token ownership. The underlying security protocols of WBTC are as solid as they have always been.”
Belshe also noted that the keys managing WBTC are now separated across different parties in a more decentralized manner, a change aimed at further enhancing security.
Justin Sun’s Strategic Role
Sun, who also addressed the concerns via an Aug. 11 post on the social media platform X (formerly known as Twitter), echoed Belshe’s sentiments. He emphasized that his involvement with WBTC is purely strategic and does not grant him any direct access to the funds.
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“There have been no changes to WBTC,” Sun stated. “The keys are still safeguarded using the same BitGo cold wallet technology and offline keys, with backups in multiple countries and regions. My personal involvement in WBTC is entirely strategic. I do not control the private keys to the WBTC reserves and cannot move any BTC reserves.”
Despite these reassurances, the BA Labs team remains cautious and has proposed an executive vote within the MakerDAO forum to determine the future of WBTC holdings. This vote, set for Aug. 12, will decide whether the DAO will implement the suggested changes, which could include restricting new debts and borrowing against WBTC.
As the situation develops, the outcome of this vote will likely have significant implications for WBTC and the broader crypto market. However, both BitGo and Justin Sun continue to assert that their actions are in the best interest of WBTC’s security and transparency.
