Coinbase CEO Brian Armstrong has accused main U.S. banks of trying 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 flexibility to earn yield on stablecoins.
In a wide-ranging interview with Fox Enterprise anchor Maria Bartiromo on Mornings With Maria, Armstrong stated the most recent 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 help this invoice as written,” Armstrong stated, citing provisions that may successfully ban tokenized securities, impose broad prohibitions on decentralized finance (DeFi), weaken the Commodity Futures Buying and selling Fee (CFTC), and remove rewards on stablecoins.
Whereas praising the Senate’s broader efforts — together with work led by Senators Tim Scott and Cynthia Lummis — Armstrong stated the draft textual content circulated earlier this week raised “harmful” points that may be tougher to repair as soon as the invoice reached the Senate ground.
Stablecoins on the heart of the crypto battle
On the heart of the dispute is stablecoin rewards. Armstrong argued that current laws, together with the GENIUS Act signed into legislation beneath President Trump, explicitly enabled stablecoin issuers to pay yield, a characteristic he described as crucial 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 stated. “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 huge banks hitting document earnings.”
Armstrong contrasted stablecoins — which beneath the GENIUS Act should 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 any fractional reserve with these stablecoins,” he stated. “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 clients wish to choose in to lending out their funds, they’ll do this,” he stated. “You don’t want a financial institution license to do this. What requires a financial institution license is lending out individuals’s cash with out their permission.”
Armstrong additionally pushed again on claims that stablecoins threaten group banks, calling the argument a “crimson herring” superior by giant monetary establishments. He stated there isn’t a proof that group banks are dropping deposits to stablecoins, including that consolidation pushed by huge banks has posed a far better menace for the reason that Dodd-Frank period.
The Coinbase CEO additionally criticized Senate language that may subordinate the CFTC to the Securities and Change Fee (SEC), requiring crypto property to cross by the SEC earlier than doubtlessly falling beneath CFTC jurisdiction.
“I can’t think about why the Senate Ag Committee would make the CFTC a subsidiary of the SEC,” he stated, pointing to the Home-passed CLARITY Act, which clearly delineates oversight between digital commodities and securities.
Trying forward, Armstrong stated he stays optimistic that lawmakers can revise the Senate invoice to align with President Trump’s crypto agenda. Nonetheless, 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 slightly haven’t any invoice,” Armstrong stated. “We’re not going to cement one thing into legislation if it harms peculiar People and bans competitors.”
