Brian Armstrong criticizes the stance of banking associations in the legislative dispute over the crypto market

At a recent political freedom forum in Florida, Coinbase and its CEO Brian Armstrong once again found themselves at the center of discussions surrounding the cryptocurrency market structure bill. The platform’s CEO issued sharp criticism not of individual financial institutions, but of entire banking trade associations, which he believes are the main obstacle to advancing this legislation.

Why Banking Associations See Cryptocurrency as a Threat

Brian Armstrong highlighted the fundamental differences in approaches to digital assets. According to him, traditional industries often adopt a zero-sum mindset. In this thinking, cryptocurrency is not seen as an opportunity for innovation or market expansion, but as a direct threat to the interests of classic financial institutions.

This differs from the stance of individual banks. Interestingly, small and medium-sized financial institutions, contrary to common stereotypes, do not panic at the prospect of deposit withdrawals in favor of stablecoin issuers. Their more pressing concern remains the outflow of funds toward large banks. Moreover, even the biggest financial players are actively integrating cryptocurrency into their infrastructure — Coinbase already supports crypto solutions for the five largest banks in the world.

Brian Armstrong on Compromises and New Legislation

Negotiations between the crypto industry and the financial sector, mediated by the White House, have been ongoing since the beginning of the month, after the Senate Banking Committee initiative failed. In recent meetings, banking associations have actively blocked the text, demanding bans on rewards for stablecoins.

Brian Armstrong expressed hope for some compromise solutions, where financial institutions would gain new opportunities and benefits under the fresh legislation. However, the Coinbase CEO refrained from revealing details of such potential agreements. Previously, when the “Digital Asset Market Clarity Act” was proposed, Armstrong publicly withdrew his company’s support, citing unacceptable conditions.

Stablecoins and Rewards: The Center of Disagreement

The issue of stablecoin rewards has become the main point of conflict in negotiations. Brian Armstrong insists that the world has long been living in a reality where regulated American stablecoins with reward systems already exist. In his view, this is a fact that must be accepted and consciously considered: whether to see this trend as an opportunity or a threat.

The irony is that banking organizations themselves are actively developing crypto competencies. Major banks are hiring blockchain and digital asset specialists, expanding their departments through professional networks and hiring platforms. This indicates that the resilience of crypto technologies is already recognized even by the traditional financial sector at the level of individual banks.

Political Obstacles and Tax Complications

Delays in negotiations are further complicated by tax issues. During the first year of implementation, new exchange reporting rules require institutions to report only gross income from crypto transactions. Buyers will have to determine the cost basis of each position themselves.

This will create an disproportionate burden on retail investors, who make numerous small trades. According to Coinbase, tax authorities unjustifiably include stablecoins like USDC, backed by the US dollar, in reporting, which is mathematically inaccurate and methodologically flawed.

Brian Armstrong and his team emphasize that such approaches overload the tax system and hinder the development of the crypto industry. The next scheduled meeting of the negotiation group is imminent, which could be a turning point in the development of U.S. legislation on digital assets.