Brian Amrstrong, the CEO of the leading crypto exchange Coinbase, says that the U.S. legislation should allow users to earn interest on stablecoin instead of introducing stablecoin bills that favor traditional banking.
In his latest article on X, Brian Armstrong emphasized that the U.S. government should not prevent the wider use of stablecoin for the sake of saving banks. Both the stablecoins and banks should be allowed to exist and offer interest to users. “This is consistent with a free market approach,” he said.
The criticism from the Coinbase CEO comes after the U.S. lawmakers plans to roll out legislation for stablecoins. This would force stablecoin issuers to become entities under Bank Secrecy Act (BSA) and might lead these firms leaning more towards becoming law-abiding rather than crypto-friendly.
“Stablecoins have already found product market fit by digitizing the dollar and other fiat currencies, but we haven’t unlocked a critical piece of the puzzle for the average person, and the US economy, to reap the full benefits: onchain interest,” Armstrong says.
While explaining benefits of earning interest on stablecoins, Armstrong says that the average FED funds rate was 4.75% in 2024 while average consumer saving account yield was 0.41%. With inflation of ~3% for the past year, consumers bore a loss of 2.5% in purchasing power.
Meanwhile on holding stablecoins, users would get 4% instead of 0.1% on saving accounts.
“We have a huge opportunity in front of us right now with a pro-crypto administration and congress actively working on new stablecoin legislation..” he said, adding “we can choose to level the playing field and ensure these laws pave a way for all regulated stablecoins to deliver interest directly to consumers, the same way a savings or checking account can.”
As per DeFillama data, the current stablecoin market cap stands at a valuation of $234.46 billion – which has seen an increase of 4.52% in the past 30 days.
Also read: Tether Adds 8,888 BTC Worth $735 Million to Reserves in Q1 2025
