Coinbase CEO: US Commodities Regulator Should Refrain from Initiating Enforcement Measures on DeFi Protocols

Coinbase CEO: US Commodities Regulator Should Refrain from Initiating Enforcement Measures on DeFi Protocols


Coinbase CEO Calls Out United States Commodities Regulator for Enforcing DeFi Protocols

Brian Armstrong, the CEO of Coinbase, has expressed his disagreement with the United States Commodity Futures Trading Commission (CFTC) for issuing warnings against decentralized finance (DeFi) protocols. Past week, the CFTC charged DeFi platforms ZeroEx, Opyn, and Deridex for offering illegal derivatives trading. The regulator imposed monetary penalties and ordered the corporations to cease violating the Commodity Exchange Act (CEA) and other CFTC regulations.

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Nonetheless, Armstrong argues that these projects are not financial services enterprises and believes that the Commodity Exchange Act does not apply to them. He hopes that the protocols of DeFi take these cases to court to establish a precedent, emphasizing that the courts have upheld the rule of law in similar situations. Armstrong implies that these enforcement actions will only push the industry offshore without achieving any meaningful outcomes.

Dissenting Opinion from CFTC Commissioner

One CFTC commissioner, Summer Mersinger, dissented against the enforcement actions. Although while she supports the CFTC filing enforcement cases in new areas to protect consumers from fraud and abuse, she believes that taking action against the 3 DeFi corporations is unwarranted in this case. Mersinger states that there is no indication of misappropriated customer funds or victimization by the protocols of DeFi targeted by the CFTC.

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Hot Take: Upholding Rule of Law in DeFi

The CEO of Coinbase urges protocols of DeFi to challenge these enforcement actions in court to establish legal precedents. He emphasizes that courts have shown a willingness to uphold the rule of law. By doing so, it can prevent pushing an important industry offshore and contribute to shaping a clear regulatory framework for decentralized finance.

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Daisy Hodley emerges as a luminary blending the roles of crypto analyst, devoted researcher, and editorial virtuoso into a harmonious symphony. In the realm of digital currencies, Daisy’s insights resonate with an exquisite resonance across a diverse spectrum of minds. Her adeptness in decoding intricate threads of crypto complexities seamlessly intertwines with her editorial finesse, translating intricacy into a captivating melody of understanding.

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