Coinbase Chief Executive Officer Brian Armstrong is set to meet with senior banking executives this week to discuss the future of US crypto market structure legislation, according to statements shared during the World Economic Forum in Davos. The discussions come after Coinbase withdrew its support for the Digital Asset Market Clarity Act, known as the CLARITY Act, citing concerns over a revised Senate draft. With legislative momentum stalled in Washington, Davos has emerged as an alternative forum for behind-the-scenes negotiations.
Armstrong said he is using the global gathering to engage not only with bankers but also with political leaders on how digital assets could modernize financial systems. He framed stablecoins and tokenization as tools that could improve efficiency and access, provided crypto firms and traditional institutions operate under comparable regulatory standards. The meetings signal an attempt to rebuild consensus after the bill’s Senate markup was postponed indefinitely.
Why Coinbase Withdrew Support
Coinbase pulled its backing of the CLARITY Act last week after reviewing a 182-page Senate Banking Committee draft shortly before a scheduled markup vote. Armstrong described the revised text as worse than the existing regulatory environment, arguing it would constrain core crypto activities rather than provide clarity. His objections focused on provisions that could limit stablecoin-related features and expand government access to user financial data.
A central point of friction involves stablecoin yields, which some banking groups argue could draw deposits away from traditional lenders. Armstrong countered that restricting these features would tilt the competitive landscape in favor of legacy banks and undermine innovation. He also raised concerns about shifting oversight authority from the Commodity Futures Trading Commission to the Securities and Exchange Commission, a change he said could increase regulatory uncertainty for digital asset markets. Coinbase’s withdrawal of support was widely viewed as a key factor behind the Senate’s decision to delay further consideration of the bill.
Broader Policy and Market Context
The talks in Davos reflect the growing institutional stakes surrounding US crypto policy as digital assets become more embedded in global finance. Stablecoins, in particular, have drawn heightened attention from policymakers due to their potential role in payments and settlement systems. For banks, the debate centers on managing systemic risk and deposit stability, while crypto firms emphasize competition and technological progress.
Armstrong said his objective is to find a compromise that allows both sectors to benefit, positioning stablecoins as complementary rather than disruptive to traditional banking. He also indicated that discussions with international leaders would focus on tokenization as a means of broadening access to capital markets, a theme gaining traction among asset managers and regulators alike.
While it remains unclear whether the Davos discussions will translate into changes to the Senate draft, the shift in venue underscores the political sensitivity of crypto regulation in the US. With legislative timelines uncertain, industry leaders are increasingly looking beyond Capitol Hill to shape the next phase of digital asset policy.