Coinbase Pushes Back on US Crypto Regulation Bill

Coinbase has signaled it cannot support a newly proposed U.S. Senate bill aimed at establishing a comprehensive regulatory framework for digital assets. According to Reuters, CEO Brian Armstrong said the legislation contains several flawed provisions that could harm innovation despite some positive elements.

The bill seeks to clarify when digital tokens fall under securities or commodities law and would place much of the crypto market under the oversight of the Commodity Futures Trading Commission (CFTC). However, Armstrong warned that the draft could weaken the CFTCs authority and create regulatory confusion.

Coinbase also criticized provisions that would effectively block tokenized equities and restrict crypto firms from paying interest or rewards on stablecoin holdings. Armstrong argued these rules would disadvantage crypto-native financial models compared with traditional banking products.

Given Coinbase‘s significant political influence and financial backing of pro-crypto initiatives, its opposition raises questions about the bill’s prospects as it heads toward a Senate Banking Committee markup. Armstrong emphasized that while Coinbase supports clear regulation, “no bill is better than a bad bill.”

The debate highlights broader industry concerns that poorly designed rules could push crypto innovation offshore at a time when other regions are advancing their own regulatory frameworks.

Source: Reuters