Coinbase’s Stand Against the Clarity Act: A Battle for Crypto’s Future in the U.S.
As the U.S. Senate prepares for a critical markup of the Clarity Act, a significant schism has emerged within the cryptocurrency industry's leadership. On one side, exchange behemoth Coinbase Global Inc., led by CEO Brian Armstrong, has launched a forceful public rejection of the current legislative draft, declaring it 'materially worse than the status quo.' The company's stance is stark: they would prefer no new regulatory bill at all rather than accept what they view as a framework that would cripple innovation and competitiveness within the United States. This opposition centers on fears that the proposed regulations would impose overly restrictive definitions and compliance burdens, effectively stalling the growth of the domestic crypto ecosystem and pushing development and talent overseas. In a surprising counterpoint, other major industry players like Ripple Labs and the advocacy group Coin Center have voiced support for the legislation. This division highlights the complex and often conflicting priorities within the crypto sector regarding regulatory engagement. Proponents likely argue that some legislative clarity, even if imperfect, is preferable to the current environment of regulatory uncertainty and enforcement-by-litigation, which has created a challenging landscape for businesses to operate and plan for the future. Ripple's support may be influenced by its own ongoing legal battles with the SEC, making a definitive legislative pathway appealing. The upcoming Senate markup session, therefore, is not just a procedural step but a pivotal moment that could define the regulatory trajectory for digital assets in America for years to come. The outcome will test the lobbying power and influence of differing industry factions. Coinbase's aggressive position underscores a high-risk strategy of demanding a 'perfect' bill, betting that congressional inaction is less harmful than a bad law. Meanwhile, supporters of the Act are gambling that establishing a foundational legal structure now is a necessary first step that can be refined later. This pre-markup debate encapsulates the core tension between the desire for rapid, unfettered innovation and the need for legal guardrails that protect consumers and provide business certainty, setting the stage for a crucial political and economic decision in early 2026.
Crypto Leaders Divided Over Clarity Act Amendments Ahead of Key Senate Markup
Coinbase Global Inc. has publicly rejected the current draft of the Clarity Act, with CEO Brian Armstrong calling it 'materially worse than the status quo.' The exchange giant argues the proposed legislation WOULD stifle crypto innovation in the US, preferring no bill over what it considers harmful regulation.
Ripple Labs and Coin Center emerge as surprising supporters of the legislation. Ripple CEO Brad Garlinghouse frames the bill as an industry victory, suggesting any flaws can be addressed through future amendments. This division highlights the crypto sector's ongoing struggle to present a unified front to policymakers.
Banking industry influence appears to be shaping the legislation, with reports suggesting traditional financial institutions are lobbying to protect their market position. The markup scheduled for January 15, 2026 could determine whether the US adopts a progressive framework for digital assets or maintains regulatory ambiguity.
Coinbase Withdraws Support from Key Crypto Legislation, Creating Industry Rift
Coinbase CEO Brian Armstrong has abruptly withdrawn support for the CLARITY Act, a landmark crypto market structure bill currently under Senate review. The move exposes deepening fractures within the digital asset industry as it seeks regulatory clarity.
Armstrong cited three fatal flaws in the draft legislation: an effective ban on tokenized equities, restrictive DeFi provisions, and inadequate privacy protections. The withdrawal comes as bitcoin holds steady above $96,000, with traders apparently pricing in regulatory uncertainty.
Analyst Jaret Seiberg framed the development as a win for traditional banks, noting the bill's momentum has stalled following Coinbase's exit. The Senate Banking Committee postponed Thursday's scheduled hearing amid dwindling support.
Not all industry players followed Coinbase's lead. Competitor Kraken and venture giant a16z Crypto maintain their backing, suggesting the bill—while imperfect—represents progress. This divergence highlights the crypto sector's ongoing struggle to present a unified front to policymakers.
