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Coinbase CEO Brian Armstrong, after reviewing the draft legislation on cryptocurrency market structure prepared by the US Senate Banking Committee, announced that Coinbase cannot support this regulation in its current form.
Armstrong said that some of the clauses in the draft text posed serious risks to the industry.
According to Armstrong’s assessment, the draft effectively bans tokenized shares while also containing provisions in the DeFi space that grant the government unlimited access to financial records and weaken users’ right to privacy. He also stated that the draft erodes the powers of the Commodity Futures Commission (CFTC), tipping the regulatory balance in favor of the SEC, which could stifle innovation.
Armstrong noted that some of the proposed changes in the draft could eliminate stablecoin rewards and give banks the power to restrict competition. Arguing that this would lead to worse consequences than the current status quo, the Coinbase CEO stated, “We would rather have no law than a bad law.”
Nevertheless, Armstrong stated that he appreciated the efforts of Senate members to reach a bipartisan consensus, and expressed optimism that a more balanced text that meets the needs of the industry could be achieved if negotiations continued.
*This is not investment advice.