Brian Armstrong, CEO of Coinbase, applauds his company's adherence to U.S. money transmitter licensing laws amid Binance's recent legal troubles. Reflecting on Binance's admission of guilt to criminal charges, Armstrong emphasizes the significance of Coinbase's decision to obtain licenses, despite facing a competitive setback.
Acknowledging the impact on growth, he states that the compliance strategy, though slower and costlier, was essential for building a company rooted in the rule of law. Armstrong admits, "We couldn't always move as quickly as others," emphasizing the trade-off between speed and compliance.
While recognizing the allure of swifter alternatives, Armstrong stands firm, stating that embracing compliance was pivotal for the long-term credibility of the platform. He defends the strategy, asserting, "We believe in the rule of law," underscoring the foundational principles guiding Coinbase's operational choices.
Armstrong criticizes the lack of regulatory clarity in the U.S., attributing it to users seeking refuge in offshore exchanges like Binance. He contends that Americans should access crypto technology without resorting to unregulated platforms. Despite the challenges, he optimistically anticipates the resolution of Binance's case acting as a catalyst for enhanced regulatory clarity. Armstrong states, "Americans should not have to go to offshore unregulated exchanges to benefit from this technology."
Expressing concern over the perceived lack of regulatory clarity, Armstrong claims that a majority of crypto transactions (about "95%") are conducted offshore due to unclear U.S. regulations. Although Coinbase faces SEC allegations unrelated to money transmitter licensing, Armstrong maintains a focus on fostering a compliant ethos within the company. He asserts, "We believe in the rule of law."
On November 21, the Department of Justice revealed Binance's agreement to plead guilty to violating the U.S. Bank Secrecy Act and serving U.S. customers without proper money transmitter licenses.