Coinbase says the US ought to create a brand new regulator for cryptocurrencies
Coinbase Founder and CEO Brian Armstrong will attend Consensus 2019 at the Hilton Midtown in New York City on May 15, 2019.
Steven Ferdman | Getty Images
The U.S. should create a new regulator to oversee digital asset markets, Coinbase said in a new policy proposal released Thursday. It warned that if the country is not properly regulated, it could be further “behind” other governments.
The proposal comes a day after one of its investors, venture capital firm Andreessen Horowitz, released its own vision of how next-generation internet services, including blockchain and digital assets, should be regulated. Executives from a16z, as the company is known, wanted to meet with executives across the government this week.
Coinbase’s vision overlaps with Andreessen Horowitz’s, but includes some nuanced differences and is more focused on digital assets. While a16z advocated collaboration between regulators, Coinbase said in its policy report that there should be only one regulator for the digital asset markets.
Coinbase’s chief policy officer, Faryar Shirzad, told CNBC that his team was deliberately aiming to come up with a bold plan to spark discussion.
“We started where a lot of people start, which is to take the existing plethora of regulators and figure out what minimal operations you can do to make things work,” said Shirzad. “And then there was a point where we just looked at each other maybe three or four weeks ago [and] We said it takes more effort to adapt the current system, which is based on an old market structure – more intellectual effort, I would say – than starting from scratch. “
He admitted that starting a new agency was certainly not the “least opposition” route.
“I end up thinking what we thought, because our proposal is just the beginning of a conversation that it made sense for us not to compromise on the key issues that we think the people should be thinking about,” said he said on a previous call to reporters.
Shirzad said in the earlier call that the company had already met with around three dozen MPs as well as several agencies to discuss aspects of the proposal. He said feedback from Capitol Hill so far has been “welcome”.
In general, Coinbase said in the policy report that it wanted a “clear and comprehensive approach to digital asset regulation and appropriate regulation”. It said regulation needs to understand how technology can benefit the public and warned that the US is already “behind” other governments in creating comprehensive regulations for digital assets.
“Unless similar steps are taken,” wrote Coinbase, referring to the “unified approach” to digital assets in the UK, European Union and Singapore. Shaping ‘modern financial services – a position the United States has long held. “
The company divided its proposals into four main pillars:
- Create a new framework for regulating digital assets separate from that of the traditional financial system.
- Transfer responsibility for regulating digital markets to a new single federal agency in addition to a nongovernmental self-regulatory organization similar to that which exists in traditional markets.
- Protect digital asset owners from fraud and market manipulation and require disclosures to promote transparency.
- Promote fair competition and interoperability between products.
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