Coinbase CEO Brian Armstrong predicts how Bitcoin (BTC), Ethereum (ETH) and other altcoins will be regulated
Coinbase CEO Brian Armstrong has a prediction of what the future regulatory landscape for crypto might look like.
In a new interview on the All-in podcast, Armstrong says the crypto industry is unlikely to be regulated solely by the US Securities and Exchange Commission (SEC) since not all digital assets can be considered collateral.
“Here’s what I’m realizing. Crypto will be many different things.
Not just one regulator will do this. Think of cryptocurrencies like bitcoin. That’s pretty clearly a commodity. Or Ethereum. Many of these are commodities, which probably should be regulated by commodities [regulator]or the CFTC.
If people want to raise money for their business as a security token, it should be regulated by the SEC as a security. That would be great if there was more clarity…
Separately, there are also some cryptocurrencies that will be currencies like stablecoins, and perhaps the Treasury should regulate those. Eventually there will be cryptocurrencies that are none of the above. They are works of art or something that probably shouldn’t even be regulated.”
Armstrong says that regulating the crypto industry requires a balance between protecting investors and being open to new innovations accessible to ordinary people.
“We want to balance protecting people, but we also want the government not to be in a position where they pick winners and losers. Just because something is legal doesn’t make it a good investment…
I think we all want to get rid of fraud, so if you’re committing fraud, which means you’ve lied to investors, then that should be a crime. I want to work with everyone in government to make sure this doesn’t happen. The danger is that we’ll ever get to a point where we say only wealthy people can invest now because there’s some kind of accredited investor test. This is inherently exclusionary. I don’t like accredited investor laws.
If we ever get to a place where the government says, “You must have XYZ criteria and a person with that years of experience on your resume,” then we’re getting into the government designed by a committee to pick winners picking and picking losers, and that’s inherently flawed because a lot of real breakthrough innovations look like bad ideas at first.
They’re the kind of things that a government agency would never invest in or put money into, so that’s the inherent tension we have to worry about. We protect people but don’t give government the role of picking winners and losers.”
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