Coinbase Urges Swift Crypto Regulation Reform

Coinbase, the largest U.S.-based cryptocurrency exchange, has outlined six key priorities to address flaws in U.S. crypto regulation. The company's chief policy officer, Faryar Shirzad, urged Congress to act swiftly to provide clear and consistent rules for the industry. This move aligns with Coinbase's ongoing pro-crypto campaigns, which include fighting legal battles to expose regulatory misconduct and advocating for clear and consistent crypto banking rules.

In a blog post, Shirzad detailed these priorities, emphasizing the need for a balanced approach to innovation and consumer protection. He warned that the lack of a clear legal framework leaves U.S. innovation at risk and consumers vulnerable to fraud. Based on this, Coinbase proposed clearly defining digital assets to enable Congress to distinguish between securities, commodities, and other digital tokens, ensuring investor protection and market integrity.

The renowned exchange also wants the Commodity Futures Trading Commission (CFTC) to be granted authority over crypto spot markets. Specifically, the CFTC, not the Securities and Exchange Commission (SEC), should regulate digital assets like Bitcoin and Ethereum. This aligns with the Trump administration's reported policy shift amid calls to tap into the CFTC's lighter regulatory touch.

Coinbase also calls for establishing clear capital-raising rules. The SEC should create transparent guidelines for blockchain fundraising without classifying every token as a security. It also wants stablecoin regulations implemented to ensure full backing of these assets and that they are subject to clear oversight for financial stability.

Another priority is protecting decentralized finance (DeFi) and digital commerce. According to Coinbase, this would ensure that DeFi platforms and non-fungible tokens (NFTs) remain free from excessive regulation. This, Shirzad says, would encourage innovation.

Lastly, Coinbase says clarity for centralized crypto entities is vital, allowing exchanges and custodians to follow clear federal or state-level guidelines for accountability.

Shirzad emphasized that the U.S. risks falling behind in blockchain innovation without legislative action, pushing developers and businesses to move abroad. Inaction would leave consumers unprotected and hinder America's leadership in the digital economy.

With these priorities, Coinbase urges lawmakers to seize this opportunity to create a regulatory framework that balances innovation with consumer protection. These priorities align with the exchange's predictions for 2025, when a favorable regulatory environment would drive market growth.