Brian Armstrong, CEO of Coinbase, has called on U.S. lawmakers to revise proposed stablecoin legislation to allow consumers to earn interest on their holdings.
Brian Armstrong, CEO of Coinbase, has called on U.S. lawmakers to revise proposed stablecoin legislation to allow consumers to earn interest on their holdings. In a post on X, Armstrong emphasized the need for regulations that enable crypto firms to offer "on-chain interest," likening this feature to interest-bearing checking accounts.
Armstrong argued that U.S. policy should not favor banks at the expense of innovation and consumer choice. He stated that both banks and crypto companies should be incentivized to share interest with consumers, promoting a free market approach.
Currently, stablecoins like USDC are pegged to the U.S. dollar and backed by reserve assets, with issuers typically retaining the yield generated from these assets.
The push for reform comes amid ongoing discussions in Congress surrounding two significant pieces of legislation: the House’s STABLE Act and the Senate’s GENIUS Act.
These bills propose treating all stablecoin issuers as financial institutions under the Bank Secrecy Act (BSA), which mandates extensive recordkeeping and customer verification. Critics, including House Majority Whip Tom Emmer (R-MN), argue that this classification could disadvantage global competitors and impose unnecessary regulatory burdens.
Additionally, the proposed legislation has drawn scrutiny from figures such as Senator Elizabeth Warren (D-MA), who has accused President Donald Trump of using stablecoin regulations to benefit his own financial interests, citing his recently launched stablecoin, USD1, through his venture, World Liberty Financial.
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