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- Coinbase rejects the Senate draft, citing risks to innovation, privacy, and DeFi growth.
- The draft bill restricts stablecoin rewards and expands federal regulatory authority.
- The 2026 roadmap includes prediction markets, Base upgrades, and wider stablecoin utility.
Coinbase has withdrawn its support for the Senate Banking Committee’s draft digital asset market structure bill. The exchange said the proposal contains restrictive rules that could harm innovation, privacy, and regulatory balance. The decision forced the Senate to pause its markup session, leaving the bill’s progress uncertain.
CEO Brian Armstrong said the company cannot support a bill that limits tokenized equities and imposes harsh obligations on decentralized finance platforms. He noted that the draft contains elements that could weaken the Commodity Futures Trading Commission’s authority. Armstrong said the current version raises structural concerns for the wider digital asset market.
Draft Bill Reveals Strict Stablecoin and DeFi Controls
The draft bill has circulated informally, providing an early look at how federal regulators aim to oversee digital assets. The document includes strict rules for stablecoin incentives. Users can earn rewards only through staking, providing liquidity, or participating in governance.
Banks argue that passive yield resembles unregulated deposits. The draft aligns with those concerns. It gives traditional financial institutions an advantage by restricting passive returns on digital asset holdings. This point has become one of the most debated parts of the proposal.
Industry analysts say the draft introduces rules that could disrupt decentralized finance. Armstrong said the proposal grants the government extensive access to individuals’ personal financial activities. He warned that it could remove essential privacy protections for users and developers.
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Commentator Aaron Day criticized the draft as a framework that expands surveillance. He said the proposal requires exchanges to monitor trades, register participants, and store transaction histories. According to him, the bill imposes registration obligations on DeFi developers that can limit permissionless innovation.
Regulatory Powers Expand as Coinbase Advances Its Strategy
The draft also gives increased authority to federal agencies. The Securities and Exchange Commission takes precedence over the Commodity Futures Trading Commission. Source code, token design structures, and transaction data should be submitted for review by exchanges and token-issuing bodies. Critics argue that this structure gives an advantage to bigger platforms with the capital to comply at scale.
Coinbase is moving ahead with his 2026 long-term plans even as policy debates heat up. The company wants to create a platform that blends cryptocurrencies, stocks, commodities, and prediction markets. Part of the expansion includes a partnership with Kalshi to offer prediction services.
Stablecoins are still a big part of Coinbase’s strategy. Armstrong highlighted their use in settlements and cross-border transactions. Coinbase is also expanding its Base Network and Base App in a bid to court more developers as well as users. It aims to help spread the use of blockchain applications.
Also Read: Grayscale Updates Crypto Portfolio: Future Investment Assets Revealed
