Provisions addressing decentralized finance, SEC jurisdiction and authorities and — of course — stablecoin yield all alarmed industry participants.
"The White House has been super constructive here," said CEO Brian Armstrong.
Cryptocurrency exchange Coinbase (COIN) recently retracted its support for the latest iteration of the crypto market structure bill, known as the CLARITY Act, just 24 hours before a crucial markup was scheduled. This signals significant concerns about the bill’s alignment with the interests of cryptocurrency firms compared to traditional banking institutions, not only for the exchange but also for broader market participants. Coinbase CEO’s Concerns Over Fair Competition On Friday, Coinbase CEO Brian Armstrong elaborated on the rationale behind the exchange’s withdrawal in an appearance on FOX Business, expressing his frustration with the notion that banks could use regulatory means to stifle competition in their favor. “It just felt deeply unfair to me that one industry [banks] would come in and get to do regulatory capture to ban their competition,” Armstrong stated. He also underscored the importance of a level playing field, asserting that competition should thrive without undue interference from powerful financial entities. Related Reading: Crypto Market Bill Draft Criticized For Allowing Continued Developer Prosecution Coinbase CEO emphasized that his concerns resonate with “much of the industry,” highlighting his obligation to advocate for customers who he believes are being shortchanged by the provisions of the proposed market legislation. “I declined to opine on the exact—whether the hearing, the markup should happen or not… But I did feel like I had to speak up on behalf of our customers and all Americans here,” he articulated. Debate Heats Over CLARITY Act Central to the ongoing debate surrounding the CLARITY Act is a critical disagreement between banks and crypto firms regarding the fate of stablecoin holders and whether they should be entitled to receive reward payments. Armstrong has previously raised alarms that the bill might prohibit tokenized equities, impose restrictions on decentralized finance (DeFi), and expand governmental access to financial data, thereby compromising individual privacy. Furthermore, he warned that the legislation could shift regulatory authority away from the Commodity Futures Trading Commission (CFTC) and towards the Securities and Exchange Commission (SEC), sidelining competition within the crypto space. Armstrong Critiques Banking Lobbying Tactics Armstrong noted the irony in the current situation, pointing out that while banks are indeed leveraging the advantages of cryptocurrency, their lobbying efforts seem aimed at restricting competing firms. “Many of these banks are actually very smart,” he acknowledged, referencing the commercial side of banking that is increasingly engaging with crypto. “They’re actually doing deals with Coinbase. We’re powering a lot of crypto and stablecoin infrastructure for them on the commercial side.” Related Reading: Bitcoin And Crypto ETFs Set To Attract $130 Billion-Plus Inflows This Year, JPMorgan Predicts Despite his criticisms of the banking sector’s lobbying tactics, Armstrong expressed optimism that legislators could ultimately resolve the outstanding issues within the crypto market structure bill: And then their lobbying arm comes to D.C. and thinks of it as very zero-sum and is trying to kill the competition. So, I suspect, like many things, if we get the principles in the room, we can actually get this figured out and make a good deal. Featured image from DALL-E, chart from TradingView.com
The US crypto industry believed it stood on the precipice of securing the regulatory legitimacy it has pursued for a decade, but the political ground has suddenly shifted beneath it. On Jan. 14, Sen. Tim Scott, the chair of the Senate Banking Committee, postponed a vote on the Digital Asset Market Clarity Act. This delay […]
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The market mood in crypto cooled sharply after a quick spike in optimism. According to the Crypto Fear & Greed Index, the reading fell by 12 points on Friday, dropping from 61 to 49. Related Reading: Altcoin Rallies Are Getting Shorter, And Wintermute Has The Data That swing moved the gauge from “greed” into a “neutral” zone in a single session. Bitcoin had jumped about 4.5% earlier in the week to roughly $97,700, which helped push sentiment higher, but the focus shifted toward politics and lawmaking in Washington. Regulatory Concerns Shake Markets Based on reports, the main trigger was debate over a Senate version of a long-awaited crypto market structure bill. The measure would set out how US regulators oversee digital assets and includes language that would tighten rules around stablecoin yields. Several lobbyists and executives raised alarms about those provisions. Brian Armstrong, the CEO of Coinbase, withdrew his backing, saying the proposal would be worse than the current setup and that a bad law would be harmful. After the backlash, the Senate Banking Committee cancelled its planned markup and the Senate Agriculture Committee moved its session to late January while lawmakers seek more support. Social Media Sentiment Shifts As Traders React According to crypto analytics firm Santiment, the market activity had two different trends at once: larger holders were building positions while smaller, retail traders were selling. Social chatter began to reflect worry after the regulatory news, even as on-chain data showed accumulation by more experienced wallets. The index’s peak earlier in the week was the highest since it reached 64 on October 10, the same day a market crash triggered over $19 billion in liquidations. Those past losses still hang in investors’ memories. Smart Money Buys While Retail Sells Reports have disclosed that smart money accumulation can support prices, but headlines shape short-term moods. Bitcoin was trading at about $95,642 at the time of publication, down around 0.02% over the past 24 hours, according to CoinGecko. That small move shows market resilience, yet the sentiment measure’s drop demonstrates how fragile confidence can be when policy doubts emerge. Many traders watch Washington closely, sometimes even more closely than charts. Related Reading: Bitcoin’s New Power Buyers: Companies Bought 3 Times What Miners Produced Delay Seen As Chance By Some Industry Players A segment of the industry read the postponements as constructive. David Sacks, who advises on crypto matters at the White House, said the pause could help close gaps between stakeholders and bring the bill closer to something workable. Brad Garlinghouse, CEO of Ripple, kept engaging with lawmakers and described the delay as an opening to improve the text. Those views contrast with more alarmed voices and help explain the mixed market reaction. Featured image from The Drive, chart from TradingView
While Coinbase said that the crypto market structure bill would essentially ban tokenized securities, companies in that sector say that's not the case.
Armstrong told CNBC that his firm pulled support for a sweeping digital assets bill after finding provisions that could have harmed consumers and stifled competition.
The following article is adapted from The Block’s newsletter, The Daily, which comes out on weekday afternoons.
The latest push to establish a comprehensive U.S. crypto market structure framework hit a snag this week, but leaders in DeFi don’t seem alarmed by the collapse.
The digital assets crowd has been complaining bitterly about bank-lobbyist tactics, but Senate lawmakers have a much longer relationship with their bankers.
Tokenization platform Securitize is going public — as soon as the first half of 2026 — through a SPAC deal with Cantor Equity Partners II (CEPT)
The recent Bitcoin rally may be driven by real spot demand on Coinbase. Data indicating elevated spot activity on Coinbase suggests that this move higher is bolstered by direct purchases rather than leveraged positioning in derivatives markets. This distinction matters because Spot buying reflects a real capital commitment, not a temporary bet. Why Risk Management When Demand Is Structural The Bitcoin rally since Sunday’s Powell subpoena news has been largely linked to Coinbase spot buyers. Crypto trader Alex Krüger has highlighted on X that both the Adjusted Coinbase Premium and Cumulative Volume Delta (CVD) show steady spot accumulation, which is exactly why this has been a true hated rally even among bitcoiners. For over a month, the dominant narrative in every crypto chat room has been that BTC is lagging while equities and commodities are moving upward. Related Reading: Analyst Outlines The Bulllish And Bearish Scenarios For Bitcoin – Here’s What To Know However, the fun fact is that equities are not accurate, but 40% of the S&P 500 (Standard & Poor’s 500) stocks have actually closed red in 2025, (39.2% to be precise). Perception is doing a lot of work here, and the United States Department of Justice (DOJ) move on Powell represented a major macro litmus test for BTC. Kruger claims that the BTC long-term value proposition is about protecting against the tail risk of central bank profligacy. On Monday, BTC surged upward, although the move was just a little surge. According to Krüger, the BTC key battlefield remains the 50-week moving average (WMA), which is currently around $101,420. Meanwhile, the trader is looking to take some profits into short liquidations right above the $100,000 mark. Why Bitcoin Benefits First From Institutional Flows The Digital Asset Market Clarity Act is set for markup today, January 15th, 2026, in the Senate Banking Committee. According to the update by BTC_road_to200k on X (Formally Twitter), this is where the lawmakers will debate and shape the final version of the bill before it moves forward. Related Reading: Bitcoin Price Stays Pinned Above Support, Setting Up a Bigger Move This matters because the art aims to clear up the ongoing regulatory uncertainty between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), which has been a major source of hesitation for large institutional players looking to move into Bitcoin and other digital assets. Furthermore, the Clarity Act will be a turning point as it aims to clear rules that will bring more confidence to banks, pension funds, and large investors, which often translates into higher demand and stronger price momentum for BTC. As the regulatory clouds lift, the market might start experiencing a renewed wave of institutional money flowing in, and that’s obviously bullish for BTC. Featured image from Pixabay, chart from Tradingview.com
Bank of America CEO Brian Moynihan warned that stablecoin yield rules could shift up to $6 trillion in deposits from banks.
A combination of timing pressures and unresolved policy concerns led Coinbase to withdraw its support for a sweeping cryptocurrency bill.
Coinbase's withdrawal of its support potentially derails market structure legislation, says an analyst, noting that it's bad for the crypto industry and good for the banks.
Coinbase won't be supporting the Senate Banking Committee's sweeping cryptocurrency legislation, its CEO said.
CEO Brian Armstrong said there were "too many issues" with the bill.
The crypto industry contends that Wall Street giants stood behind community banks to undercut digital competitors before they could get a major legislative win.
Lawmakers and the crypto industry are sifting through pages and pages of bill text, with much of the focus being on stablecoin rewards.
The following article is adapted from The Block’s newsletter, The Daily, which comes out on weekday afternoons.
As the January 15 markup of the crypto market structure bill—known as the CLARITY Act—draws closer, reports indicate that Coinbase (COIN) is reconsidering its support for the legislation. A Monday report from Bloomberg suggests this shift in position is contingent on whether the anticipated bill includes provisions beyond enhanced disclosure requirements tied to stablecoin rewards. High Stakes For Coinbase The CLARITY Act is expected to be marked up in at least one Senate committee this Thursday, and Coinbase’s potential withdrawal could have significant implications for the bill. A source familiar with Coinbase’s stance told Bloomberg that the exchange would re-evaluate its support if the legislation veers too far from its interests, particularly regarding stablecoin incentives. Some insiders suggest the bill might restrict the ability to provide rewards to regulated financial institutions, a move that aligns with the banking sector’s concerns about losing deposits to crypto platforms. Related Reading: Dogecoin Breaks Its ‘Lower-Band Prison’ As Daily Trend Flips Coinbase currently holds applications for a national trust charter that could permit it to offer those kinds of rewards under regulatory rules. However, many crypto-native firms are pushing back against potential restrictions, arguing that such measures could disrupt competition in the market. The stakes for Coinbase are high, as rewards programs play a crucial role in its business model. The exchange allows users to earn 3.5% rewards on Circle’s USDC holdings. Should the market-structure bill include bans on these incentives, fewer users might choose to hold stablecoins on the platform. This could jeopardize an anticipated revenue stream projected at $1.3 billion in 2025, according to Bloomberg. Banking Vs. Crypto The GENIUS Act, passed into law in July of last year, prohibits stablecoin issuers from offering interest on token holdings, and does not prevent third-party partners like Coinbase from providing rewards tied to customer balances. The banking industry, however, argues that allowing exchanges to pay such rewards could negatively impact bank deposits and, consequently, community lending. As reported by Bitcoinist over the past month, the American Bankers Association (ABA) has voiced concerns that this situation could displace “billions” from local lending, allegedly harming small businesses and households. In contrast, Faryar Shirzad, Coinbase’s chief policy officer, has argued that maintaining rewards tied to stablecoins is crucial for preserving the dollar’s dominance, especially in light of China’s announcement to start offering interest on its digital yuan. Banking Lobby Fights Back A potential compromise being discussed would permit only licensed banking entities or financial institutions to provide rewards on stablecoin balances. Related Reading: Why The $2.9 Billion Bitcoin Whale Buy Could Spell Doom For The Market Recently, five crypto firms, including Ripple, Circle, and Paxos, received conditional approvals from the US Office of the Comptroller of the Currency (OCC) to become national trust banks, a move met with opposition from the banking lobby. If restrictions are indeed imposed, the report suggests that this could lead to creative workarounds as crypto firms seek alternative ways to reward customers. Featured image from DALL-E, chart from TradingView.com
The following article is adapted from The Block’s newsletter, The Daily, which comes out on weekday afternoons.
Coinbase is one of the largest Solana stakers, with nearly 10% of the network’s total staked SOL, according to its Validator Performance Report.
Bernstein said the window to pass the bill is rapidly narrowing amid a dispute between banks and the crypto industry over stablecoin rewards.
Disagreements over stablecoin rewards have frayed bipartisan support for the bill, with traders estimating a 68-70% chance of passage this year.
Coinbase may withdraw its support from the market structure bill if it imposes broader limits on stablecoin rewards, Bloomberg reported.
The crypto market is flashing early signals of a first-quarter recovery as the dust finally settles on December’s sharp sell-off. According to a new analysis from Coinbase, four structural indicators suggest the correction was a temporary setback rather than a regime shift. Fresh inflows into spot ETFs, a drastic reduction in systemic leverage, improved order […]
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The bank also pointed to infrastructure revenue, including Base and derivatives, as emerging buffers against trading volatility.
Bank of America said it recommended investors buy Coinbase's stock, pointing to its new products including weekday equities trading and prediction markets.
The US crypto industry has launched a unified push for Congress to pass federal market-structure legislation, known as the “Digital Asset Market Clarity Act of 2025” (H.R. 3633). The legislation is viewed by industry proponents as the necessary “missing layer” of federal law to allow the industry to thrive. While the “GENIUS Act” established baseline […]
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