Coinbase backs Democratic consumer rules added to US crypto bill
Democratic additions to the CLARITY Act have secured the backing of Coinbase, but the flagship US crypto legislation still faces a final hurdle over ethics provisions tied to the president's digital asset holdings.
Democratic lawmakers have inserted new consumer protection measures into the Digital Asset Market Clarity (CLARITY) Act, securing crucial industry backing as the US Senate nears a vote on the comprehensive crypto legislation.
The provisions give the bill "more teeth," according to Coinbase vice chair Ryan VanGrack. "[A]t the end of the day, this is about customer protections," VanGrack told CNBC on Monday. "The status quo lacks this infrastructure, lacks these protections, and the Democrats used this opportunity, wisely, to make sure that customers were first and foremost in [this bill]."
The CLARITY Act is poised to become the most significant regulatory framework for digital assets in the United States. For exchanges like Coinbase, passage would replace the current regulatory vacuum that previously resulted in an SEC lawsuit alleging the company operated as an unregistered securities exchange, broker and clearing agency.
That lawsuit, filed under the Biden administration, was dropped shortly after President Donald Trump took office and appointed Mark Uyeda as acting SEC chair. Coinbase's current endorsement marks a reversal from January, when CEO Brian Armstrong stated the exchange could not support an earlier version of the bill, a move that reportedly delayed a committee markup. Armstrong and chief legal officer Paul Grewal have since publicly urged the Senate to pass the legislation.
Despite the progress on consumer rules, the bill's fate remains uncertain due to unresolved ethics provisions. VanGrack did not detail any advances on these ethics rules, which Senate Democrats have stated are a prerequisite for their support.
Those requirements stem from concerns over the president's financial ties to the crypto sector. In June, Trump disclosed $1.4 billion in earnings connected to his Official Trump (TRUMP) memecoin, his family's World Liberty Financial, and other digital asset investments. Republicans met with Trump on Thursday to discuss the bill, while Senate Democrats held a closed-door session on Wednesday to evaluate their stance.
Trump has publicly championed the legislation, recently urging the Senate to pass the CLARITY Act "in honor of" the late Senator Lindsey Graham, whom he described as a "big supporter." Lawmakers have not yet released the final text of the bill or scheduled a floor vote.
