Brian Armstrong, the CEO of cryptocurrency exchange Coinbase, is confident that the United States will achieve clarity with crypto regulations, “even if it takes a while.” However, he believes this is the vital component to luring entrepreneurs back to the country.
Armstrong sat down for an interview with Wall Street Journal on June 11, just days after the SEC filed a lawsuit against Coinbase on June 6. The SEC alleged that Coinbase has been operating a securities exchange, broker-dealership and clearing house without registering with the commission.
Full WSJ interview on YouTubehttps://t.co/yIF3dGI7oN
— Brian Armstrong ️ (@brian_armstrong) June 10, 2023
Armstrong addressed the lawsuit in the WSJ interview, explaining that he believes those registrations weren’t required for Coinbase to operate.
“The assets that we do trade, those are commodities, so they don’t require those registrations […] we are trading on our exchange crypto commodities.”
Despite not claiming to be one, Armstrong also noted that Coinbase has faced difficulties in activating its broker-dealer license.
“We don’t claim to be a broker-dealer, we have acquired a broker-dealer license that is still dormant, because they won’t allow us to activate it” he said.
As for regulations, Armstrong explained that it isn’t “rocket science” and the U.S will acheive the “right outcome, even if it takes a while.”
He pointed out that the SEC v Coinbase lawsuit is important for the U.S. cryptocurrency industry as a whole, with hopes it will lead to more clarity and prevent the country from “falling behind” the rest of the world.
Armstrong is of the opinon that once there is clear and stable regulations regarding cryptocurrency in the U.S., it will encourage the return of crypto businesses to the country.
“We will see entrepreneurs who left the US come back. They’ll say we won’t be attacked randomly or have incredibly high legal bills at any given moment.”
Cointelegraph previously reported on April 11 that the share of global crypto developers in the US declined by 26% from 2018 to 2022, with the report citing “little regulatory clarity” as a major factor and as a result “America’s edge may be slipping.”
Armstrong highlighted key regulation points that he believes need to be clarified, including clear “boundaries” between the two major United States financial regulators – the SEC and the Commodity Futures Trading Commission (CFTC).
He pointed out that while other countries, such as the United Kingdom have one financial regulator, the US is currently witnessing a “turf war” due to having two regulatory bodies.
Related: SEC lawsuits against Binance and Coinbase unify the crypto industry
He believes that many of the fundamental regulations can simply be transferred from traditional finance such as basic consumer protection, financial statement audit requirements, and procedures for both Anti-Money-Laundering (AML) and Know Your Customer (KYC).
Armstrong reiterated that there is currently “no clear rule book” for cryptocurrency regulations in the U.S., and despite continuously asking the SEC for more clarity, Coinbase couldn’t “get any feedback.”
This comes after Armstrong responded to the SEC lawsuit against Coinbase over Twitter, on June 7, saying that he is proud to “represent the industry in court” and get some “clarity around crypto rules.”
Magazine: Binance, Coinbase head to court, and the SEC labels 67 crypto-securities: Hodler’s Digest, June 4-10
