Coinbase CEO Flags Major Issues with U.S. Crypto Bill, Withdraws Support
Coinbase CEO Brian Armstrong has taken a firm stance against the latest draft of the U.S. crypto market structure bill, saying that the legislation as written could do more harm than good for the industry. Armstrong’s public opposition has injected fresh uncertainty into Washington’s efforts to create a federal framework for regulating digital assets. The draft bill, introduced by Senate lawmakers, aims to clarify key questions — such as when a token qualifies as a security or a commodity and which agency should oversee spot crypto markets. But after reviewing the text over the past 48 hours, Coinbase concluded it cannot support the proposal in its current form.
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Key Concerns from Coinbase
Armstrong highlighted several provisions in the bill that he believes could undermine innovation and market fairness:
- Tokenized equities risk — The current language could effectively ban or severely restrict tokenized stocks and asset-linked tokens.
- DeFi limitations — Rules proposed in the draft may impose undue restrictions on decentralized finance, potentially stifling growing sectors of the crypto ecosystem.
- Privacy and oversight risks — The draft could broaden government access to consumer financial data and weaken the role of the Commodity Futures Trading Commission (CFTC) in favor of the Securities and Exchange Commission (SEC) — a move some fear would concentrate regulatory power.
- **Stablecoin reward restrictions — Changes under consideration might prohibit or limit reward structures tied to stablecoin holdings, potentially giving traditional banks an advantage.
Armstrong made it clear that Coinbase would “rather have no bill than a bad bill,” adding that the current version could leave the U.S. digital asset landscape worse off than today’s unregulated environment. Despite the opposition, he expressed hope for a revised draft that could address these concerns.
Broader Industry Context
Coinbase’s withdrawal of support comes just as the Senate Banking Committee delayed its scheduled review of the bill, highlighting how pivotal industry feedback remains in shaping U.S. crypto policy. The bill’s fate is now tied to continued negotiations between lawmakers, regulators and industry stakeholders.
While some industry voices have previously expressed optimism about bipartisan momentum for a clear regulatory framework, the disagreement underscores the difficulty of drafting legislation that balances consumer protection, innovation, and competitive fairness.
