Positive regulator of the Wnt signaling pathway. Specifically cleaves 'Lys-63'-linked ubiquitin chains. May act by deubiquitinating APC protein, a negative regulator of Wnt-mediated transcription (By similarity). Required for an efficient wg response, but not for other signaling responses, in the eye. Thiol-dependent hydrolysis of ester, thioester, amide, peptide and isopeptide bonds formed by the C-terminal Gly of ubiquitin (a 76-residue protein attached to proteins as an intracellular targeting signal). Interacts with Apc. The OTU domain mediates the deubiquitinating activity. The RanBP2-type zinc fingers mediate the specific interaction with 'Lys-63'-linked ubiquitin. Flies are viable and fertile, suggesting functional redundancy. Belongs to the peptidase C64 family.