Coinbase Global Inc. (NASDAQ:COIN) CEO Brian Armstrong reportedly faced harsh criticism from Wall Street’s biggest bank chiefs at the World Economic Forum in Davos.
The Davos Showdown
JPMorgan Chase (NYSE:JPM) CEO Jamie Dimon interrupted Armstrong’s coffee meeting with former U.K. Prime Minister Tony Blair to confront him directly according to a Wall Street Journal feature published on Friday.
“You are full of s—,” Dimon said with his index finger pointed at Armstrong’s face, telling him to stop lying on television.
Armstrong had appeared on business TV accusing banks of trying to sabotage crypto legislation.
Bank of America (NYSE:BAC) CEO Brian Moynihan gave Armstrong 30 minutes but dismissed his position, telling him to either be a bank or be a money-market fund.
Citigroup (NYSE:C) CEO Jane Fraser gave him less than one minute while Wells Fargo (NYSE:WFC) CEO Charlie Scharf refused to talk entirely.
The Fight Over Stablecoin Rewards
Banks and Coinbase are battling over stablecoin rewards that pay holders of dollar-pegged tokens like USDC around 3.5%—far higher than the 0.1% banks offer on checking accounts.
Banks warn that if customers move money into higher-yielding stablecoins, it threatens $6.6 trillion in deposits that banks need to fund loans to businesses and communities.
Armstrong argues the free market should decide and banks can compete by raising rates or launching their own stablecoin products.
Armstrong Blocks The Bill
Brian Armstrong pulled support for the CLARITY Act the day before the Senate Banking Committee vote, calling it worse than the current system.
The draft included provisions effectively banning Coinbase from offering yield to customers.
The impact was immediate. Senate Banking Committee Chair Tim Scott (R-SC) canceled the vote hours later, shocking the financial world.
The move demonstrated Coinbase’s political muscle.
The company poured $75 million into the 2024 election and now holds $193 million in its super PAC war chest, making it one of the best-funded political forces in the country.
White House Meeting Monday
The White House is hosting bank and crypto groups Monday with Trump’s AI and crypto czar David Sacks attending. Coinbase’s head of U.S. policy Kara Calvert will join.
Armstrong proposed solutions including a new class of stablecoin issuers allowed to pay rewards if they meet tighter regulatory standards, letting banks compete on equal footing.
Other proposals suggest banning most reward payments with narrow exemptions for Coinbase.
What This Means For COIN
The Senate Agriculture Committee advanced its portion of the bill Thursday, but passing comprehensive legislation requires Armstrong’s support.
Any deal likely needs his approval to move forward.
Coinbase maintains partnerships with JPMorgan and Citi despite the public battle.
The company’s partnership with stablecoin issuer Circle generates significant revenue from USDC rewards.
For the stock, regulatory clarity unlocks institutional adoption, but Coinbase needs stablecoin rewards to remain legal since they drive core revenue.
A bill banning those payments damages the business model while no bill leaves regulatory uncertainty intact.
The Monday meeting determines whether compromise is possible or if the battle escalates, potentially delaying legislation until after 2026 midterms.
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