Coinbase CEO Warns 48-Hour Review Shows Senate Crypto Bill Could Harm Market
Coinbase CEO Brian Armstrong has come out swinging against the current Senate Banking Committee's take on a cryptocurrency bill.
Quick overview
- Coinbase CEO Brian Armstrong criticized the Senate Banking Committee's cryptocurrency bill for potentially banning tokenized equities and limiting decentralized finance.
- He expressed concerns that the legislation would grant excessive power to the SEC while diminishing the CFTC's authority.
- Armstrong warned that the bill could lead to increased regulations on tokenized assets and compromise personal financial privacy.
- He emphasized the need for better regulations that foster innovation in the crypto industry rather than stifle it.
Coinbase CEO Brian Armstrong has come out swinging against the current Senate Banking Committee’s take on a cryptocurrency bill. After a 48-hour deep dive into the draft, Armstrong was less than impressed by certain provisions that could end up banning tokenized equities, really limiting what decentralised finance can do, and basically putting the brakes on the rewards that stablecoins are meant to offer.
Armstrong warned that this legislation would, in effect, give the SEC massive power while simultaneously stripping the CFTC of its authority. He also pointed out clauses that allow banks to squash new market entrants by stifling stablecoin innovation.
Key concerns Armstrong had to flag:
- The SEC is getting way too big for its britches
- The CFTC is getting pushed to the sidelines
- The government is getting a whole lot of access to super personal financial information
- Tokenized equities & DeFi products are getting slammed with extra regulations
The Senate’s Banking Committee Hearing Just Hit a Speed Bump
Originally, the Senate Banking Committee was going to look at and vote on the bill on Thursday morning. However, CoinDesk reported that Senator Cynthia Lummis suggested the hearing might be postponed.
After reviewing the Senate Banking draft text over the last 48hrs, Coinbase unfortunately can’t support the bill as written.
There are too many issues, including:
– A defacto ban on tokenized equities
– DeFi prohibitions, giving the government unlimited access to your financial…— Brian Armstrong (@brian_armstrong) January 14, 2026
The idea behind the legislation is to clarify which kinds of digital assets are considered securities or commodities, and who gets to keep an eye on them all. Lawmakers want to clarify the rules around crypto. Still, Armstrong thinks this particular draft will have a bunch of unintended consequences that, in the long run, will only serve to stifle innovation and keep investors out.
Coinbase is calling for better Regulation
Armstrong made it very clear that Coinbase respects the lawmaker’s efforts and all, but he thinks this draft is basically worse than nothing. He argued that passing this flawed legislation could be a serious setback for the crypto industry and make the whole market less competitive.
Armstrong pledged that Coinbase would keep fighting for crypto-friendly rules that allow for growth and protect investors. The company’s stance highlights the ongoing tug of war between regulators who want to bring crypto into line and crypto companies who are fighting for rules that will let them grow without getting strangled.
Armstrongs statement pretty much boils down to:
- No legislation is better than bad legislation
- Protecting DeFi and tokenized assets from getting wiped out
- Continuing the fight for regulations that let crypto grow
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