Last week, Binance, the world’s largest crypto exchange, received a massive $4 billion fine. Binance CEO Changpeng Zhao also had to resign.
Brian Armstrong, CEO of crypto exchange Coinbase, reacts to the incident and emphasizes the importance of complying with regulations in the crypto world.
Since Coinbase was founded in 2012, we have taken a long-term view. I knew we had to implement compliance to become a multi-generational company that would stand the test of time. We got the licenses, hired the compliance and legal teams, and made it clear that our brand is about trust…
— Brian Armstrong 🛡️ (@brian_armstrong) November 21, 2023
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Regulatory validation for crypto’s success
Binance has recently faced fines and investigations in multiple jurisdictions. Binance is said to be selling unregistered securities and is guilty of fraud and market manipulation.
Armstrong sees these developments as confirmation that sticking to the rules was the right decision.
“We wanted to increase transparency and raise the bar for trust, which is why we went public in 2021.” This meant that we couldn’t always act as quickly as others. It is harder and more expensive to take a compliant approach.
You can’t market every product that customers want if it’s illegal. But it is the right approach because we believe in the supremacy of the law,” Armstrong said.
Armstrong emphasizes the importance of building a constructive relationship with regulators and taking proactive measures to ensure compliance.
Armstrong is using the incident to attack Binance. He believes his exchange grew less quickly than its competitors because it took a more serious approach to regulation.
Armstrong was suddenly full of praise for crypto regulation
Armstrong suddenly praises American regulations. Above all, he sees the long-term advantages:
“Americans shouldn’t have to go to unregulated currency exchanges to benefit from this technology. This industry should be built here in America in a compliant manner and under American law.”
This is quite surprising considering that Armstrong has regularly criticized the unclear regulations in the US and the strict supervision of the Securities and Exchange Commission (SEC) over the past year. This is why Coinbase is expanding outside the US.
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