White House Reconsiders Crypto Bill Amid Coinbase's Withdrawal: Report
White House Considers Pullback on Crypto Legislation
The White House is reportedly contemplating retracting its endorsement of a crucial crypto market structure bill. This development follows a similar move by Coinbase, as reported by Fox Business journalist Eleanor Terrett, citing a source close to the Trump administration.
Coinbase's Sudden Withdrawal Raises Concerns
On Sunday, Terrett revealed through a post on X that the White House is displeased with Coinbase's decision to withdraw support for the Digital Asset Market Clarity Act. The move has been described as "unilateral" and unexpected by administration officials.
The source indicated that the administration might abandon the bill unless Coinbase resumes negotiations and compromises on stablecoin yield provisions to satisfy banking interests. "This is President Trump's bill at the end of the day, not Brian Armstrong's," the source emphasized.
Coinbase Highlights Risks to DeFi and Stablecoins
Coinbase CEO Brian Armstrong explained on Wednesday that the exchange could not back the Senate Banking Committee's draft as it currently stands, citing potential harm. "We'd rather have no bill than a bad bill," Armstrong stated.
Armstrong raised several concerns, including a perceived ban on tokenized equities, restrictions on decentralized finance (DeFi), and increased government access to financial records, which could undermine user privacy.
He also warned that the proposal might weaken the Commodity Futures Trading Commission while strengthening the Securities and Exchange Commission, an agency criticized by the crypto industry for its enforcement-heavy approach.
Stablecoins emerged as another contentious point. Armstrong warned that the draft risks "killing rewards" on stablecoins, reflecting industry fears that the bill protects banks from competition. Banking groups argue that allowing users to earn around 5% yields on stablecoins could lead to significant deposit outflows from traditional savings accounts.
Division Within the Crypto Community
The crypto community remains divided. Many users supported Coinbase's stance, accusing lawmakers and banks of favoring incumbents over innovation. "Then the banks should stop trying to screw everyone over," commented Nic Carter, cofounder of Coin Metrics, on X.
Others argue that Coinbase overstepped and should not have veto power over legislation affecting the entire industry. "Coinbase is not crypto. Coinbase is one exchange in crypto," one user wrote.