Coinbase CEO Brian Armstrong said he expects a revised draft of the U.S. Senate crypto market-structure bill to reach markup within a few weeks after lawmakers postponed the session that had been set for January 15, 2026. The delay came right after Coinbase withdrew support for the draft, with Armstrong publicly describing it as “worse than no law.”
The pause crystallized industry fault lines over tokenized equities, DeFi oversight, and stablecoin reward mechanics, temporarily slowing a bipartisan push that has been building for years to define clearer regulatory boundaries for digital assets.
Why Coinbase stepped back
Armstrong’s objection centered on provisions Coinbase views as commercially disruptive and likely to push activity offshore rather than create workable U.S. guardrails. In Coinbase’s framing, the draft doesn’t just tweak compliance expectations—it changes the operating model for multiple core product lines.
On tokenized assets, Coinbase interpreted the language as a de facto ban on tokenized equities, which it argues would stall a growing segment of tokenized real-world assets and narrow legitimate on-chain market development in the U.S.
On decentralized finance, Coinbase characterized the draft as overly prescriptive for DeFi, warning that the approach would expand surveillance expectations and erode the privacy and permissionless properties that many DeFi designs rely on to function.
On stablecoins, Coinbase pointed to limits on stablecoin reward mechanisms that would reduce a revenue stream the company depends on and that, per the same reporting, banking lobbyists oppose as potentially siphoning deposits from traditional institutions.
Market and legislative signal
Reactions across the sector and on Wall Street were split, underscoring that the postponement can be read two ways. Benchmark analysts framed the delay as potentially constructive breathing room that could help negotiators reconcile disputes—especially around stablecoin yield and the balance of jurisdiction between the SEC and the CFTC. Compass Point took the opposite view, calling the withdrawal and the postponement a “material setback” and warning that momentum could fade as the 2026 election cycle advances, potentially pushing final passage into 2027.
Notably, Coinbase did not speak for the entire industry. Kraken co-CEO Arjun Sethi reaffirmed support for the legislation, emphasizing the value of a statutory framework over piecemeal enforcement, even if compromises are required to get a bill across the finish line.
Armstrong’s expectation of a markup within weeks signals that talks are still live, and that leadership believes a workable rewrite is achievable without locking in provisions Coinbase considers anti-innovation. For market participants and infrastructure providers, the near-term focus is whether the pause produces a narrower, higher-consensus draft on stablecoin rewards, tokenized assets, and regulator jurisdiction—or whether the window closes and comprehensive U.S. market-structure rules slip beyond the current cycle.
