In a social media post on November 21st, Brian Armstrong, the CEO of Coinbase, discussed recent developments in the cryptocurrency industry. He mentioned the criminal allegations faced by rival exchange Binance and expressed his satisfaction that Coinbase had chosen to obtain a money transfer license, even though it put the company at a competitive disadvantage.
Armstrong emphasized the importance of regulatory compliance, stating that Coinbase had obtained licenses and engaged compliance and legal teams, ensuring that their brand adhered to the rules. He acknowledged that Coinbase’s compliance-centric strategy had sometimes slowed down the company’s growth, as it could be more challenging and costly to implement than other approaches. However, Armstrong asserted that Coinbase’s commitment to compliance was the right path because “we believe in the rule of law.”
He also pointed out what he perceived as a lack of regulatory clarity in the United States, which, according to him, was pushing users towards foreign exchanges like Binance. Armstrong stated, “Americans shouldn’t have to go to unregulated foreign exchanges to benefit from this technology.” Nevertheless, he expressed optimism that the U.S. government’s criminal case against Binance could ultimately catalyze greater regulatory clarity.
Armstrong asserted that U.S. regulations lacked clarity and had driven “95%” of cryptocurrency trading overseas. The Securities and Exchange Commission (SEC) had filed a lawsuit against Coinbase, accusing the company of violating U.S. securities laws. However, these allegations were unrelated to violations of the Bank Secrecy Act or money transfer licensing issues.