Coinbase CEO Brian Armstrong confirmed that the U.S. crypto market structure bill remains a focus during the World Economic Forum in Davos, Switzerland. Armstrong said he will meet with bank executives and legislators to address regulatory gaps, stablecoin restrictions, and competition between crypto platforms and traditional financial institutions.
Armstrong Shows Bill Concerns and Senate Engagement
Armstrong said Coinbase recently withdrew support from the Senate’s updated bill due to provisions favoring traditional banks and limiting stablecoin yield. He noted that certain bank lobbying groups sought to restrict digital asset platforms from paying yield solely for holding stablecoins. Armstrong stressed that Coinbase is regulated by the SEC, CFTC, and operates under a national trust charter, eliminating fractional reserve risks typical for banks.
He added that discussions with Senate members highlighted challenges in achieving a balanced bill that protects consumers while fostering innovation. “There were three or four red line issues in the draft,” Armstrong said, adding that further negotiations aim to restore a level playing field for U.S. companies competing in digital assets.
Stablecoins and Bank Competition
Armstrong explained that banks view crypto rewards programs as a potential deposit flight risk. He contrasted crypto platforms with traditional banks, emphasizing 100% reserve models and no fractional lending.
“We do not need a bank license, as the current law and Genius Act confirm,” Armstrong said, clarifying that stablecoin issuers can operate safely within existing regulatory frameworks.
He noted that Coinbase will continue engaging bank CEOs to shift their perspective from seeing crypto as a threat to recognizing potential opportunities. Armstrong said that aligning incentives for both banks and crypto companies could help achieve bipartisan support for the legislation.
Ongoing Work at Davos
At Davos, Armstrong plans to meet world leaders and financial executives to discuss how tokenization and blockchain could update traditional finance and expand access to capital markets.
He confirmed that Coinbase will relay these discussions to the Senate and administration to facilitate legislative progress. Meanwhile, the Senate Banking Committee has postponed its markup hearing, reflecting ongoing negotiations over the bill’s language.
