Coinbase CEO Brian Armstrong accused major US banks of trying to sabotage President Donald Trump’s pro-crypto agenda, warning that proposed changes to a Senate market structure bill could stifle innovation, ban entire categories of digital assets and strip Americans of the ability to earn returns on stablecoins.
In a wide-ranging interview with fox business presenter María Bartiromo in Mornings with MariaArmstrong said the latest draft legislation to emerge from the Senate Banking Committee represents a “giveaway to the banks” that risks regulatory overreach and undermining recent bipartisan progress on crypto policy.
“After reviewing the Banking Senate draft over the past 48 hours, Coinbase unfortunately cannot support this bill as written,” Armstrong said, citing provisions that would effectively ban tokenized securities, impose broad bans on decentralized finance (DeFi), weaken the Commodity Futures Trading Commission (CFTC), and eliminate rewards on stablecoins.
While he praised the Senate’s broader efforts, including work led by Sens. Tim Scott and Cynthia Lummis, Armstrong said the draft that circulated earlier this week raised “dangerous” issues that would be more difficult to fix once the bill reached the Senate floor.
Stablecoins at the center of the crypto conflict
At the center of the dispute are stablecoin rewards. Armstrong argued that recent legislation, including the GENIUS Act enacted under President Trump, explicitly allowed stablecoin issuers to pay yield, a feature he described as critical to giving Americans better returns on their money.
“The banks are really coming in and trying to undermine the president’s crypto agenda,” Armstrong said. “They are trying to protect their own profit margins, taking money out of the pockets of average, working Americans and putting it into the coffers of big banks that are making record profits.”
Armstrong compared stablecoins, which under the GENIUS Act must be 100% backed by short-term US Treasuries, with traditional fractional reserve banking, arguing that stablecoins carry less systemic risk. “There is no fractional reserve with these stablecoins,” he said. “They should not be subject to the same regulation as banks.”
Bartiromo pressed Armstrong on whether crypto platforms should face the same regulatory burdens as banks, including deposit insurance and investor protection.
Armstrong responded that such frameworks exist primarily to manage the risks created by fractional reserve lending, noting that FDIC insurance only covers deposits up to $250,000.
“If customers want to choose to lend their funds, they can do so,” he said. “You don’t need a banking license to do that. What you do require a banking license is to lend money to people without their permission.”
Armstrong also rejected claims that stablecoins threaten community banks, calling the argument a “red herring” put forward by large financial institutions. He said there is no evidence that community banks are losing deposits to stablecoins, adding that consolidation driven by big banks has posed a much greater threat since the Dodd-Frank era.
The Coinbase CEO also criticized Senate language that would subordinate the CFTC to the Securities and Exchange Commission (SEC), requiring crypto assets to pass through the SEC before potentially falling under the CFTC’s jurisdiction.
“I can’t imagine why the Senate Agriculture Committee would make the CFTC a subsidiary of the SEC,” he said, pointing to the House-passed CLARITY Act, which clearly delineates oversight between digital products and securities.
Looking ahead, Armstrong said he remains optimistic that lawmakers can revise the Senate bill to align it with President Trump’s crypto agenda. However, he issued a clear warning: “It is better to have no bill than to have a bad bill.”
“If you ban entire categories of new products like tokenized stocks, I’d rather not have any bills,” Armstrong said. “We’re not going to sign something into law if it hurts ordinary Americans and prohibits competition.”
