- Coinbase CEO Brian Armstrong says the failure of the CLARITY Act may reduce competition for the firm in the short term.
- Armstrong believes SEC and CFTC rules will be more permissive than the failed bill, benefiting Coinbase temporarily.
- The SEC granted a five-year exemption for tokenized stock trading venues following the bill’s defeat.
- Armstrong confirmed Coinbase’s tokenized stock product has reached nearly $1 billion in trade volume.
Coinbase Global CEO Brian Armstrong said that the failure of the CLARITY Act likely means less competition for the exchange in the near term. On The Daily Wolf podcast, Armstrong stated that while the bill’s demise was good for the U.S., every major financial firm would have begun incorporating crypto under its provisions.
Armstrong noted that the bill failed to secure the required 60 votes, with the ethics dispute serving as the final obstacle. He added that SEC and CFTC rules “arguably are going to be more permissive in certain ways” than the CLARITY Act. “In the short term, it’s probably better for us in certain ways,” Armstrong said.
Armstrong claimed that banks fought hard against stablecoin payouts but are now in a worse position. He said the GENIUS Act is “already the law of the land,” and Coinbase will continue paying stablecoin rewards. The CEO suggested banks may return in a few years to push for a “clarity version two.”
Regarding tokenized stocks, Armstrong reported that Coinbase’s product has already achieved nearly $1 billion in trade volume. He described the tokens as “real security” redeemable one-for-one with underlying shares, distinguishing them from synthetic alternatives. Armstrong said the U.S. version may include onchain Know Your Customer checks.
The SEC recently granted temporary relief from the definition of “exchange” to tokenized securities venues using permissioned automated market makers. The five-year exemption requires venues to verify that tokenized stock holders receive the same rights as traditional shareholders. COIN stock closed up over 11% on Friday, with retail sentiment remaining neutral.
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