Coinbase CEO Brian Armstrong has accused main U.S. banks of trying to sabotage President Donald Trump’s pro-crypto agenda, warning that proposed modifications to a Senate market construction invoice might stifle innovation, ban total classes of digital belongings and strip Individuals 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 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 mentioned 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 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 regulation beneath President Trump, explicitly enabled stablecoin issuers to pay yield, a function he described as important to giving Individuals higher returns on their cash.
“The banks are actually coming and attempting to undermine the president’s crypto agenda,” Armstrong mentioned. “They’re attempting to guard their very own revenue margins, taking cash out of the pockets of hardworking, common Individuals and placing it into the coffers of massive banks hitting report 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 is no such thing as 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 clients wish to decide in to lending out their funds, they will do 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 “crimson herring” superior by massive monetary establishments. He mentioned there isn’t any proof that neighborhood banks are dropping deposits to stablecoins, including that consolidation pushed by massive banks has posed a far larger risk 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 belongings to go 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 mentioned, pointing to the Home-passed CLARITY Act, which clearly delineates oversight between digital commodities and securities.
Wanting forward, Armstrong mentioned 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 foul invoice.”
“If it prohibits total classes of latest merchandise like tokenized equities, I’d quite haven’t any invoice,” Armstrong mentioned. “We’re not going to cement one thing into regulation if it harms unusual Individuals and bans competitors.”
