Coinbase Advocates for Stablecoin Regulation
Executives at Coinbase are calling on U.S. legislators to recognize the interrelated nature of stablecoin regulations and broader market structure reforms in the ongoing discussions surrounding crypto regulation. During the Blockchain Futurist Conference, Shan Aggarwal, Coinbase’s Chief Business Officer, articulated how the Senate’s deliberations over a market structure bill, known as CLARITY, complement the GENIUS Act—an earlier stablecoin legislation passed in July.
Legislative Synergy for On-Chain Economy
Aggarwal emphasized that together, these pieces of legislation act as a crucial catalyst for the development of the on-chain economy. He remarked,
“GENIUS has set the groundwork for the proliferation of stablecoins. With an increasing supply of stablecoins, there is more on-chain capital available, which can be funneled into innovative tokenized assets through the provisions of the CLARITY bill. This not only promotes the circulation of stablecoins but also ensures they can be utilized more effectively in on-chain money markets or treasury funds. It’s an exhilarating opportunity for enhancing the industry’s growth.”
Institutional Interest and Ecosystem Development
In support of this sentiment, Scott Meadows, Coinbase’s interim head of business development, noted that the GENIUS Act has significantly increased institutional interest in the cryptocurrency landscape by clarifying the operational rules within the industry. He added,
“The combination of clarity from GENIUS and the market structure legislation creates a synergistic effect that ultimately fosters a comprehensive ecosystem with defined engagement protocols for institutions.”
Current Legislative Landscape
Coinbase’s comments come simultaneously with the U.S. Treasury’s review of the GENIUS Act recommendations. In a letter to regulators, Coinbase petitioned for a relaxation of any potential ban on interest payments for stablecoins, suggesting that cryptocurrency exchanges should not be included in these restrictions, unlike stablecoin issuers.
While efforts to pass the GENIUS Act continue, progress on the market structure legislation, officially titled the Responsible Financial Innovation Act, is currently stalled due to a government shutdown and political disputes. As of the latest updates, discussions among lawmakers were still ongoing, although the timeline for actual passage by the Republicans remains uncertain.
Engagement with Lawmakers
In light of these developments, Coinbase CEO Brian Armstrong made a trip to Washington D.C. on October 23 to engage directly with lawmakers about the market structure proposals, indicating that there is broad agreement on approximately 90% of the legislative framework under consideration.
