Coinbase CEO Brian Armstrong has said that the crypto industry can finally start to move ahead by closing the latest chapter that saw a list of scandals and problems, including the Binance crypto exchange being addressed when the firm made a historic settlement with the United States Department of Justice, that saw the exchange getting hit by a fine of $4.3 billion and its CEO, Changpeng Zhao, also known as C.Z., being removed from the company.
In an interview with CNBC, Armstrong said: “The enforcement action against Binance is allowing us to kind of turn the page on that and hopefully close that chapter of history. Many crypto companies are helping build the crypto economy and change our financial system globally. But many of them are still small startups.”
Armstrong also added that the regulatory clarity gained from the DOJ’s case against Binance is going to help in bringing more investment, especially from institutions.
Binance has been in hot waters for quite some time, during which the exchange was accused of breaking several laws. The regulatory authorities have been scrutinizing Binance’s operations for quite some time and have raised several red flags where they objected to the practices of the world’s biggest crypto exchange by market capitalization.
The U.S. government accused Binance of violating the Bank Secrecy Act and breaching sanctions on Iran. Finally, the authorities were able to gain a victory when the former CEO of Binance pleaded guilty to money laundering violations and, as a result, were hit with a massive fine. It is worth mentioning that Binance is still not out of the woods as the SEC’s current investigation is still ongoing against the U.S. arm of the company, Binance.US.
Armstrong challenged the stigma around Crypto.
Armstrong has challenged the notion that cryptocurrencies can prove to be a valuable tool for performing illegal and immoral activities like fraud, money laundering, and, worst of all, financing terrorism. The use of Crypto for such actions is also the reason why many believe that financial institutions are still reluctant to commit to entering into the crypto space as they are concerned about compliance issues.
He stated that while it is true that some illicit activities have been done involving Crypto, it only represents less than 1% of the overall usage. He argued that this number is still very low if we compare it to the number of illicit activities that are committed using cash, which has a very high percentage.
However, Armstrong also acknowledged that there are “bad actors” present in this industry that haven’t helped in improving the image of cryptocurrency among the regulatory authorities who are still on the fence about adopting it completely.
He noted cases like Binance, the collapse of FTX, and the conviction of FTX’s founder Sam Bankman-Fried on fraud charges have affected the image of cryptocurrency but has also emphasized that such instances are limited.
Currently in the U.K. for the Global Investment Summit, where Coinbase was the sole crypto company invited, Armstrong viewed this as an endorsement for Coinbase specifically rather than the broader crypto industry.
He admired the U.K. Prime Minister Rishi Sunak’s leadership in the realm of digital currencies. Armstrong mentioned that Coinbase is increasing its investments in the U.K.
Despite Coinbase being embroiled in a legal dispute with the United States Securities and Exchange Commission (SEC) over allegations of violating securities laws, Armstrong remains optimistic about the company’s chances in the lawsuit.
He countered the idea that the SEC’s actions have compelled Coinbase to move its operations offshore, asserting that the company continues to actively invest in its home market.
