Coinbase CEO Brian Armstrong slammed a Senate Democratic proposal that would regulate DeFi front-ends as brokers, calling it a “bad proposal” that threatens U.S. crypto innovation.
Summary
- Coinbase CEO Brian Armstrong criticized a Senate Democratic proposal to regulate DeFi front-ends as brokers, saying it would hinder U.S. crypto innovation.
- Other crypto advocates echoed the concern, warning the plan could effectively ban DeFi development in the U.S.
“We absolutely won’t accept this,” Armstrong declared in a post on X, warning that the proposal would hinder innovation and prevent U.S. from becoming the crypto capital of the world. However, he acknowledged that the “legislating is a process” and said that Coinbase is committed to working with lawmakers to “get it right.”
For context, the proposed framework, reportedly circulated among Senate Democrats, outlines how regulators could oversee decentralized finance as part of broader crypto market structure legislation.
According to reporting from Politico, the document suggests that any company or individual profiting from a DeFi platform’s front end (e.g. wallet interfaces and user-facing apps) should be required to register with the Securities and Exchange Commission or the Commodity Futures Trading Commission and operate as a licensed broker.
Armstrong isn’t alone in his criticism. Summer Mersinger, CEO of the Blockchain Association and former CFTC commissioner, said the proposal would “effectively ban decentralized finance, wallet development and other applications in the United States.”
“The language as written is impossible to comply with and would drive responsible development overseas,” Mersinger said in a statement. She urged policymakers to continue bipartisan talks and avoid stifling technological progress.
Jake Chervinsky, chief legal officer at venture firm Variant, echoed the sentiment on X, saying that regulators were effectively proposing a crypto ban.
Source: https://crypto.news/coinbase-ceo-blasts-senate-plan-on-defi/