Coinbase CEO Brian Armstrong has accused main U.S. banks of making an attempt to sabotage President Donald Trump’s pro-crypto agenda, warning that proposed adjustments to a Senate market construction invoice may stifle innovation, ban whole classes of digital property and strip People of the power to earn yield on stablecoins.
In a wide-ranging interview with Fox Enterprise anchor Maria Bartiromo on Mornings With Maria, Armstrong mentioned the newest draft of laws rising from the Senate Banking Committee represents a “giveaway to the banks” that dangers regulatory overreach and undermines current bipartisan progress on crypto coverage.
“After reviewing the Senate Banking draft over the past 48 hours, Coinbase sadly can’t assist this invoice as written,” Armstrong mentioned, citing provisions that might successfully ban tokenized securities, impose broad prohibitions on decentralized finance (DeFi), weaken the Commodity Futures Buying and selling Fee (CFTC), and get rid of rewards on stablecoins.
Whereas praising the Senate’s broader efforts — together with work led by Senators Tim Scott and Cynthia Lummis — Armstrong mentioned the draft textual content circulated earlier this week raised “harmful” points that might be more durable to repair as soon as the invoice reached the Senate ground.
Stablecoins on the middle of the crypto battle
On the middle of the dispute is stablecoin rewards. Armstrong argued that current laws, together with the GENIUS Act signed into legislation underneath President Trump, explicitly enabled stablecoin issuers to pay yield, a function he described as essential to giving People higher returns on their cash.
“The banks are actually coming and making an attempt to undermine the president’s crypto agenda,” Armstrong mentioned. “They’re making an attempt to guard their very own revenue margins, taking cash out of the pockets of hardworking, common People and placing it into the coffers of massive banks hitting document earnings.”
Armstrong contrasted stablecoins — which underneath the GENIUS Act have to be backed 100% by short-term U.S. Treasuries — with conventional fractional-reserve banking, arguing that stablecoins carry much less systemic danger. “There isn’t a fractional reserve with these stablecoins,” he mentioned. “They shouldn’t be topic to the identical regulation as banks.”
Bartiromo pressed Armstrong on whether or not crypto platforms ought to face the identical regulatory burdens as banks, together with deposit insurance coverage and investor protections.
Armstrong responded that such frameworks exist primarily to handle dangers created by fractional-reserve lending, noting that FDIC insurance coverage solely covers deposits as much as $250,000.
“If prospects wish to choose in to lending out their funds, they will try this,” he mentioned. “You don’t want a financial institution license to do this. What requires a financial institution license is lending out folks’s cash with out their permission.”
Armstrong additionally pushed again on claims that stablecoins threaten neighborhood banks, calling the argument a “purple herring” superior by massive monetary establishments. He mentioned there is no such thing as a proof that neighborhood banks are shedding deposits to stablecoins, including that consolidation pushed by massive banks has posed a far better menace for the reason that Dodd-Frank period.
The Coinbase CEO additionally criticized Senate language that might subordinate the CFTC to the Securities and Change Fee (SEC), requiring crypto property to move by way of the SEC earlier than doubtlessly falling underneath CFTC jurisdiction.
“I can’t think about why the Senate Ag Committee would make the CFTC a subsidiary of the SEC,” he mentioned, pointing to the Home-passed CLARITY Act, which clearly delineates oversight between digital commodities and securities.
Trying forward, Armstrong mentioned he stays optimistic that lawmakers can revise the Senate invoice to align with President Trump’s crypto agenda. Nevertheless, he issued a transparent warning: “It’s higher to haven’t any invoice than a nasty invoice.”
“If it prohibits whole classes of recent merchandise like tokenized equities, I’d moderately haven’t any invoice,” Armstrong mentioned. “We’re not going to cement one thing into legislation if it harms unusual People and bans competitors.”
