- The rhetoric in Washington, is shifting as crypto money floods campaign coffers.
- Chevron deference is gone — and that’s a good thing for the industry, Armstrong said
Coinbase’s founder and CEO Brian Armstrong said on Thursday that he’s optimistic whoever is elected in November’s elections — whether Republican or Democrat — will be “constructive on crypto.”
“The rhetoric has shifted,” Armstrong told analysts on a call discussing the company’s quarterly earnings.
“We continue to advance progress on crypto policy and capitalise on this moment.”
Here’s why Armstrong said he’s bullish on crypto’s future in the US.
Crypto legislation
The jury is out on whether voters will be swayed by the relatively niche issue of crypto regulation.
Still, a well-funded crypto lobby has convinced politicians that they will be — or, at least, that office-seekers shouldn’t miss out on potential campaign financing.
Coinbase has been core to this lobby.
Coinbase contributed $25 million to the Fairshake political action committee in the second quarter, Armstrong said.
That brings its total donations to the PAC to $49 million, according to the exchange.
Republican presidential hopeful Donald Trump has overtly courted the industry on the campaign trail.
Presumed Democratic pick Kamala Harris has said nothing directly about the crypto industry.
Members of her team have reportedly reached out to the industry’s main players, including Coinbase.
With crypto emerging as a surprise campaign issue, Congress may move faster on relevant legislation.
“Politicians on both sides of the aisle have taken notice, and there is growing momentum to pass comprehensive crypto legislation — potentially even this year,” Armstrong said.
The House of Representatives has approved a draft law that would create a market structure for crypto.
Armstrong said that since he took Coinbase public, he and his team have called for clear rules of the road for crypto businesses.
“Ninety percent of institutional investors say regulatory clarity would boost their confidence in investing more in crypto,” Armstrong said.
“Coinbase will continue to push for clear rules in the courts, in Congress, and in the November elections.”
SEC backs off
The Securities and Exchange Commission has dropped some of its investigations against the industry, Armstrong said.
Coinbase is embroiled in a lawsuit with the powerful securities markets regulator, which the SEC filed in June 2023 as part of a broader crackdown on the industry.
Since then, Armstrong has been an outspoken critic of what he characterises as the SEC’s regulatory overreach.
The SEC recently dropped its investigations into stablecoin issuer Paxos and Ethereum developer Consensys.
The SEC’s approval of spot Ethereum exchange-traded funds, which began trading last week, was also a bullish sign, Armstrong said.
SCOTUS win
In a seismic ruling in June, the Supreme Court overturned an established legal standard known as Chevron deference.
For 40 years, the precedent saw judges defer to regulators in situations where the law was unclear.
Crypto lawyers say this will kneecap the SEC’s enforcement drive against the industry.
Paul Clement, a US solicitor general during the administration of President George W. Bush, argued the case that led to Chevron’s overturning.
Clement joined Coinbase’s board in July.
This case is significant for Coinbase, Armstrong said, as it supports the company’s assertion that the SEC overstepped its legal authority in suing the exchange.
“We see this case as a sign of Supreme Court scepticism to agency overreach, which we view as a positive overall for our industry,” he said.
Joanna Wright writes about policy and law for DL News. Reach out to her at joanna@dlnews.com
