Coinbase Chief Calls for Congress to Establish Clear Crypto Rules: Warns US at Risk of Losing Financial Hub Status

Coinbase CEO Brian Armstrong has urged Congress to introduce clear cryptocurrency legislation and warned that the US runs the risk of losing its status as an international financial center. “Crypto is open to everybody in the world and others are leading,” he emphasized.

Coinbase CEO on crypto regulatory framework

Nasdaq-listed Coinbase’s (Nasdaq:COIN) CEO Brian Armstrong has called on Congress to pass clear crypto regulations. He tweeted Wednesday:

The US is at risk of losing its status as a financial center in the long term without clear guidelines for cryptocurrency or a hostile regulatory environment. Congress should act quickly to ensure clear laws are passed.

“Crypto is open to everybody in the world and others are leading,” he added, referring to the EU, the UK and Hong Kong.

In addition, Armstrong has voiced discontent with the lack of clarity around US cryptocurrency regulations, which makes it hard for businesses to comply. However, US Securities and Exchange Commission (SEC) Chairman Gary Gensler claims the regulation is clear and that most crypto tokens can be classified as securities, according to the agency.

Gensler has been criticized for his enforcement-focused approach to regulating crypto firms. Recently, the securities watchdog took action against crypto exchange Kraken’s acquisition program. On Thursday, the SEC sent a notice of additional fees to Wells Fargo, Paxos and Binance USD (BUSD) stablecoin issuer Terraform Labs CEO Do Kwon for alleged fraud against investors.

Coinbase has insisted that the tokens it holds are not typically classified as securities by its staking partners. Armstrong tweeted on February 12: “Coinbase’s staking partners typically are not securities. We would be happy to defend that in court if necessary.” Additionally, Coinbase tweeted on February 14:

We don’t know what aspects of BUSD might be of interest to the SEC. What we do know: stablecoins are usually not securities.

As the US is ramping up its regulation of cryptocurrency, a number of jurisdictions are vying to become crypto hubs, such as Singapore, Hong Kong and South Korea’s second-largest city, Busan.

Kraken CEO Jesse Powell, who agreed to pay $30 million after his exchange was settled with the SEC, also called on Congress. “Congress must act to protect the domestic crypto industry and US consumers who will now go abroad for services no longer available in the US,” Powell wrote.

Do you agree with Coinbase CEO Brian Armstrong that the US needs clear crypto regulation or does it risk losing its status as a financial center? Let us know on the feedback page.