Coinbase CEO shares ideas on crypto regulation December 21, 2022
Coinbase CEO shares ideas on crypto regulation <br><br><br><br>
Coinbase CEO shares ideas on crypto regulation
In the aftermath of FTX, where the regulators have become too keen to regulate cryptos, Coinbase CEO Brian Amstrong has shared his insights and clarity on crypto regulation for better consumer protection and industry advancement in their company’s blog post.
After keeping watch how centralized actors such as exchanges, custodians, and stablecoin issuers also became the reason to harm users, Coinbase CEO claims to share “a realistic blueprint” to begin regulations from there.
He even emphasized that there should be “a level playing field across exchanges while preserving the decentralized crypto innovations that will bring enormous benefits to the world.”
On the other hand, he pointed out that decentralized actors, such as DeFi and DAO, work transparently, “do not involve intermediaries, and have their own set of protections.” Brain expressed that they can be left alone from the regulatory eyes.
From 2020 to 2022, the market for stablecoins globally has increased by 30 times, which has reached $161 billion today. “These crypto assets could bring efficiencies and greater competition to payment services, especially in a more digitalized economy,” per the Bank of Canada.
Even the Bank of Canada has released the need to regulate stablecoins, just as Armstrong did. In the same way, Bill Hagerty, US Senator, has also brought the Transparency Act for stablecoins.
According to Coinbase CEO, regulators must register stablecoin issuers as state trusts or OCC national trust charter. He commented these issuers should not only be banks unless they want to pitch for fractional banking and invest in more volatile assets. Moreover, the issuers should conduct annual audits and have enough reserves to back up all customer funds.
Armstrong also suggested they must have a blacklisting system, establish board governance, be SOC-compliant, and have reasonable control.
Armstrong has shared several regulations to reduce the fear of investors in crypto exchanges and custodians. He suggested there is a need to have strong consumer protection policies, to have anti-money laundering (AML) rules, standard know-your customer (KYC), and to establish a federal registration and licensing regime.
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