CLARITY Act Update: Coinbase CEO Rebuts Claims White House Threatened to Drop Support

The CLARITY Act discussion intensified after Coinbase CEO Brian Armstrong denied reports that the White House threatened to drop support. He said the administration has remained constructive and engaged. 

Armstrong Denies Claim Regarding CLARITY Act

Armstrong wrote in an X post, addressing journalist Eleanor Terrett, that her assertion was not true. The crypto journalist had earlier stated that the White House was considering withdrawing its support for the crypto bill.   

The Coinbase CEO stated that the White House has been “super constructive,” asked them to work out a deal with the banks, and that negotiations with the banks are ongoing. He also revealed that the top crypto exchange is working on policy ideas related to the bill. This includes proposals that will assist community banks.

Coinbase Chief Legal Officer Paul Grewal, however, replied in a much more reassuring tone on X post. He mentioned that the White House has been transparent and that Coinbase is optimistic about the engagement. He argues that retail protections are its top priority.

Arrington Blames Banks for Yield Limits

Michael Arrington posted his thoughts on the CLARITY Act in an X post, saying banks want to charge customers but pay no interest on customer deposits. He proposed that the banking industry is guarding its advantage, rather than supporting equitable returns for consumers.

Arrayington took it a step further, attacking lawmakers for allowing restrictions on stablecoin yields. Elected officials accede to such restrictions, he said, because banks exert a powerful lobbying force. He called the result damaging to Americans, saying that financial policy is weighted towards what banks want rather than what’s best for consumers.

The statement from Arrington comes in the wake of Bank of America CEO Brian Moynihan’s comments that yield-generating stablecoins could lure $6 trillion away from traditional bank deposits. That shift, Moynihan said, could put the squeeze on bank liquidity, cripple lending ability — particularly of smaller businesses and midsize companies — and drive borrowing costs up.

Armstrong responded directly to Arrington’s comments. “Exactly,” he wrote, indicating that he agreed with the argument that banking lobbies are driving the discussion of yield around crypto legislation.

Industry executives remain uncertain about the bill’s pace of movement. Nevertheless, Galaxy Digital CEO Mike Novogratz added that the CLARITY Act could pass in the next 2 weeks. He claimed that he is being optimistic because that is the tone of his recent interactions with senators.

It is worth noting that Novogratz had called for compromise on the crypto bill, stating that it doesn’t have to be perfect. He also suggested that they could revisit issues such as the stablecoin yield prohibition later on.