Coinbase Urges U.S. Regulators for Crypto Clarity

Coinbase, the largest U.S.-based cryptocurrency exchange by trading volume, has called on federal regulators to clarify rules allowing banks to offer digital asset services. The company has sent letters to three major banking regulators - the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board of Governors, and the Federal Deposit Insurance Corporation (FDIC) - requesting explicit confirmation that banks can provide crypto custody and trading services, either directly or through third-party providers.

In the letters, Coinbase argues that while federal laws already permit banks to engage in crypto activities, regulatory uncertainty has prevented many institutions from entering the market. Faryar Shirzad, Coinbase’s chief policy officer, stated, “We need clarity that banks can work with qualified third-party providers to serve their customers’ crypto needs.”

Coinbase has been actively working with regulators to promote fair crypto regulations. In a recent development, the company received approval from the UK Financial Conduct Authority (FCA) to become the United Kingdom’s biggest Virtual Asset Service Provider (VASP). This registration makes Coinbase the largest registered digital assets player in the UK. The UK Government and the FCA are developing welcome regulation for the crypto sector, which Coinbase believes will help the UK embrace economic freedom and free markets.

Coinbase’s advocacy for fair crypto regulations comes as Paul Grewal, Coinbase’s chief legal officer, prepares to testify against Operation Choke Point 2.0. This operation, initiated by the U.S. Department of Justice, aims to cut off financial services to industries deemed high-risk, including cryptocurrency. Coinbase argues that this operation could stifle innovation and harm consumers by limiting access to legitimate crypto services.

In a blog post, Coinbase stated, “Operation Choke Point 2.0 is an attempt to strangle the crypto industry by cutting off its access to banking services. This would not only harm consumers but also stifle innovation and economic growth. We urge the Department of Justice to reconsider this misguided approach and work with the industry to promote fair and responsible regulation.”

Coinbase’s advocacy for fair crypto regulations and its opposition to Operation Choke Point 2.0 reflect the company’s commitment to promoting a healthy and sustainable crypto ecosystem. As the largest U.S.-based crypto exchange, Coinbase plays a crucial role in shaping the regulatory landscape for the industry. By working with regulators and advocating