Coinbase Threatens to Pull Support Over Crypto Bill

• Lyla Velez
• January 12, 2026
• Policy
• 0 Comments

Coinbase’s potential withdrawal highlights tensions over U.S. crypto regulation, impacting market structures and revenue.

In a bold move, Coinbase Global Inc.

has threatened to abandon its backing for a U.S. crypto market-structure bill. The company is concerned about new limits on stablecoin rewards, particularly regarding their ability to pay yield on USDC balances. Coinbase warns that this move could reshape its competition with banks, as these rewards form a significant revenue line.

The bill’s restrictions could directly impact Coinbase’s revenues, estimated at 1.3 billion dollars by 2025. Faryar Shirzad, Coinbase’s Chief Policy Officer, argued limiting stablecoin rewards would undermine U.S. dollar-linked digital assets competitiveness. Latham & Watkins tracks such regulatory developments. Coinbase’s decision underscores its strategic interests in maintaining its revenue model and competition stance. The GENIUS Act, a U.S. law, currently allows exchanges to offer stablecoin rewards but prohibits issuers from doing so.

Coinbase’s warning could have wide-reaching effects on the crypto industry, leading to significant shifts in how stablecoin rewards are structured. The potential tightening of restrictions may compel other exchanges to seek new regulatory strategies. The broader implications could reshape the crypto market structure, influencing trading environments for assets like BTC and ETH. This regulatory tension highlights the delicate balance between innovation and compliance within the industry.

Faryar Shirzad, Chief Policy Officer, Coinbase, argues that preserving stablecoin rewards is vital for “US dollar competitiveness,” noting that “China recently said it would pay interest on its digital yuan.”