Coinbase CEO Brian Armstrong has pushed back against reports of a deepening rift with the Trump administration, insisting that collaboration remains “super constructive” regarding the CLARITY Act.
This followed a report from crypto journalist Eleanor Terrett, who said the administration was furious with the exchange.
Polymarket Puts CLARITY Act Odds of Passage This Year at 41%
According to the report, officials were prepared to withdraw support for the legislation unless Coinbase returned to negotiations with a compromise on stablecoin yields.
SponsoredAt the heart of the dispute is the traditional banking sector’s fear of “deposit flight.”
Community and regional banks have warned that allowing crypto exchanges to offer high yields on stablecoins could accelerate deposit outflows. They argue that customers would move funds from low-interest savings accounts into dollar-pegged digital assets, raising risks to banking stability.
However, Armstrong disputed the characterization that the White House is threatening to kill the bill. Instead, he framed the situation as a strategic directive from the administration to solve the specific concerns of regional lenders.
He noted that the White House tasked the exchange with negotiating a deal with the banks, and that the specific details were “coming soon.”
“Actually, we’ve been cooking up some good ideas on how we can help the community banks specifically in this bill, since that’s what this is about,” Armstrong wrote on the social media platform X.
This tension highlights the fragility of the comprehensive bill, which aims to provide long-sought regulatory clarity for the digital asset industry.
Earlier in the week, Coinbase signaled it might withdraw its support for the CLARITY Act. The exchange cited provisions that would ban tokenized stocks, restrict decentralized finance protocols, and eliminate stablecoin rewards.
Meanwhile, industry peers are watching the negotiations closely.
Ripple CEO Brad Garlinghouse noted that while the legislative process is contentious, the Senate’s move represents a “massive step forward” for protecting consumers and establishing a workable framework.
“Ripple (and I) know firsthand that clarity beats chaos, and this bill’s success is crypto’s success. We are at the table and will continue to move forward with fair debate,” he said.
Despite this optimism, prediction markets remain skeptical about the timeline. On the betting platform Polymarket, traders are currently pricing in only a 41% chance that the market structure bill will pass into law this year.