Coinbase (COIN) CEO Brian Armstrong said Wednesday he is “optimistic” a bill establishing rules for stablecoins could gain passage in the Senate as soon as this week, despite recent pushback that forced lawmakers to redouble their efforts.
“I’m actually pretty optimistic this bill can get done,” Armstrong told Yahoo Finance in a Wednesday interview while on Capitol Hill in Washington, D.C. “There’s a lot of urgency on both sides of the aisle to see this come to fruition.”
A highly anticipated vote on long-awaited stablecoin legislation in the Senate broke down last week after Democrats balked at how President Trump and his family could benefit from the legislation. Stablecoins are cryptocurrencies pegged to other assets, such as the US dollar.
Others had different objections, from anti-money laundering issues to consumer protections to whether people close to government officials can own or benefit from these assets.
Because of the new Democratic pushback, a vote scheduled last Thursday fell short of the 60 votes needed to pass the full Senate.
The crypto industry has a lot riding on the stablecoin bill, as well as a separate market structure bill also being pushed by lawmakers, as it reaches for more mainstream acceptance and looks to benefit from a more favorable approach from the nation’s capital.
Trump himself has urged new regulations while also participating financially in the crypto industry via a number of new ventures.
Coinbase, the largest US cryptocurrency exchange, is itself benefiting from crypto’s breakthrough to more investors. One sign of that acceptance is that it is set to join the S&P 500 on Monday, replacing Discover, which was was acquired by Capital One.
“Coinbase joining the S&P 500 means crypto’s here to stay,” Armstrong said. “It’s going to be in everybody’s 401(k). Everyone’s going to have crypto exposure at least indirectly through Coinbase. And it’s also a symbol that crypto is updating the financial system.”
The push for stablecoin legislation is not without controversy. The US banking industry has lobbied to prevent opening any kind of loophole in the stablecoin bill that would let crypto firms offer bank-like products while sidestepping the more stringent rules US banks must follow.
They are specifically seeking language that prevents US stablecoin issuers and intermediaries from offering interest to customers.
Armstrong said he doesn’t think the bill should prohibit paying interest on stablecoin assets and that banks need to be able to compete on a level playing field.
He said he also hopes anti-money laundering laws don’t get dramatically expanded to include non-financial services like decentralized finance protocols.
“We believe that, you know, the government shouldn’t really be doing protectionism for one industry versus another,” Armstrong said. “They should publish clear rules and have a level playing field for competition.”
Some banks have said they would issue their own stablecoins if legislation allows such a move. When asked whether he has concerns about banks doing so, Armstrong said that he thinks everyone should be able to create stablecoins.
“Crypto is a technology to update the financial system, and we want every bank, fintech company, every payment company to be integrated,” he said.
Armstrong said he thinks the majority of all payments in the economy at some point will be running on stablecoin rails.
What Coinbase likely won’t do is apply for a banking license, because current legislation would not require it to do so, according to Armstrong.
“We don’t have any need to or desire to pursue that. But obviously if something were to change in the law, we could always consider that.”
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