Coinbase responds to accusations of undermining crypto regulation

Coinbase, the cryptocurrency exchange, rejected accusations that it was attempting to thwart the development of cryptocurrency regulation, voiced earlier by U.S. Senator Elizabeth Warren, a member of the Senate Banking Committee.

We responded to Senator Warren’s letter accusing @coinbase of hiring national security veterans as a way to fight bipartisan legislation.

In our response, we said that:
— We are very proud of our record of rooting out illicit activity on our platform, and of our deep partnership…

— Faryar Shirzad ?️ (@faryarshirzad) December 23, 2023

In her letter to Coin Center and Blockchain Association dated December 18, Warren touched on the issue of hiring national security experts at a number of crypto companies. In her view, this approach is aimed at fighting regulation of the industry, in particular the bipartisan law on digital assets.

She demanded that organizations provide by January 14 information on “the number of former military, civilian, government officials and members of Congress”, working in the industry and their salaries.

The head of Blockchain Association Christine Smith confirmed receipt of the letter and noted that Warren «should focus her efforts on criminals, not those who work hand-in-hand with U.S. law enforcement to catch bad actors».

3/ As Americans, we all share the common goal of fighting terrorism and protecting our national security. Sen. Warren should focus her efforts on the perpetrators, not those working hand-in-hand with U.S. law enforcement to catch bad actors.

— Kristin Smith (@KMSmithDC) December 19, 2023

«The industry is keen to participate in political issues. Last month we invited Senator Warren to our annual political summit in Washington — just a mile from her office […]. We had hoped she would join us, but she did not», said Smith.

CEO of Coin Center, Jerry Brito, called Warren’s letter «bold» and «a bullying publicity stunt».

Coin Center received the same impertinent letter from Elizabeth Warren as the BA and Coinbase. Read it for yourself to see what a bullying publicity stunt it is. pic.twitter.com/YF3SFQ8rqh

— Jerry Brito (@jerrybrito) December 19, 2023

Coinbase, a member of the Blockchain Association, sent a reply letter to Warren. Policy Director Faryar Shirzad called her claim incorrect, and the accusations unfounded.

According to him, the recruitment of former officials and law-enforcement officers is part of an initiative aimed at protecting crypto users in the United States.

«We are very proud of our team of national-security experts who daily devote themselves to protecting Americans», the letter said.

In November, Coinbase expanded its Global Advisory Council with new members. They include:

• former US Secretary of Defense Mark Esper;
• former Congresswoman and national-security expert Stephanie Murphy;
• former White House homeland-security adviser Frances Townsend;
• former managing director at BRG Group, David Urban.

In December, Coinbase Chief Brian Armstrong criticised Warren and her fellow senator Roger Marshall for attempts to influence big banks against the crypto industry.

Earlier it emerged that Coinbase, Ripple, Circle, Kraken and other players in the Bitcoin market allocated a total of $78 million to support the political action committee Fairshake, which advocates pro-cryptocurrency candidates for the U.S. presidency.

In June, Armstrong named the upcoming elections in the United States a key moment for the regulation of digital assets.

According to a Grayscale report, the promotion of cryptocurrencies by presidential candidates is driven by the forecast that Generation Z and millennials will constitute a significant portion of voters — about 44%. Young people trust traditional institutions less and are more inclined toward new technologies.