WHEN: Today, Wednesday, June 7, 2023
WHERE: CNBC’s “Squawk Box”
Following are excerpts from the unofficial transcript of a CNBC interview with Coinbase CEO & Founder Brian Armstrong on CNBC’s “Squawk Box” (M-F, 6AM-9AM ET) today, Wednesday, June 7. Video of the interview will be available on CNBC.com.
All references must be sourced to CNBC.
ARMSTRONG ON SEC DECISION
BRIAN ARMSTRONG: Our centralized exchange is really trading a much smaller number of assets. We reviewed, you know, over a thousand assets in crypto. We rejected 90% of them because we felt they weren’t appropriate for our exchange and about 200 of them are listed on our centralized product. And I don’t know to his point about, you know, what’s the there there, people are using crypto for all kinds of things, they’re not just trading and they’re doing payments with it. You know, Ukraine raised 200 million dollars and presidential candidates are taking it in. It’s a new technology that can be used to update all kinds of financial services and we don’t need the government picking and choosing our technology winners. Let’s let the market decide that.
ARMSTRONG ON COINBASE BEING A PUBLIC COMPANY
ARMSTRONG: They allowed us to become a public company, understanding the S1, right? And so, I feel like that’s our moment to be totally transparent with them, show them everything about our business and how it operates and so, it’s not great to have a regulator sort of come back later and say actually we changed our mind. This is already a public company.
ARMSTRONG: But, no, I’m glad we became a public company because I wanted, I want us to go first. It’s not easy to go first. You’re going to take a few arrows, you know, we have to educate the public market investors. We have to deal with the SEC but that’s what being the leader in the space means and so, we’re happy to do that.
ARMSTRONG ON REGULATORS
ARMSTRONG: The regulator does have the right to come, you know, edit their thinking at times and come back and say here’s a new set of rules and great, we’d be happy to follow those. The issue in this case is that we’re getting conflicting statements from the CFDC head and the SEC head and then statements from the SEC are so, you know, such an outlier. They’re saying everything other than Bitcoin is a security. Well, that’s not our interpretation of the law. That’s not what the law says and so, and that’s not what the position of every other country around the world their financial regulators is taking and so, I really don’t think we had a choice honestly. We had to go to court to really see if otherwise, this industry is just not going to exist in the United States if we took that position.
ARMSTRONG ON SEC MEETINGS
ARMSTRONG: We met with the SEC 30 times in the last year. They never gave us a single piece of feedback about what we could be doing better. We just got silence. And when we asked them how would you like us to register, you know, we have this dormant broker license, could we activate that. We got, we really got silence. And so, it’s not appropriate for the regulator to come back and do an enforcement action if we don’t have a clear rulebook and clear guidance.
ARMSTRONG ON BINANCE CASE VERSUS COINBASE CASE
ARMSTRONG: The companies could really not be more different, and the suits could not be more different, so in Coinbase’s case, for instance, there hasn’t been any allegation of misappropriation of customer funds. You know, I haven’t been named personally. The executives haven’t been named personally, we’re, this really, the complaint in the Coinbase situation is really a technical matter about do you classify these as commodities or securities and, you know, we’re based here in the U.S. We’ve never operated a hedge fund or something that trades against our customers. We, all our financial statements are audited, you know, the customer segregation, the funds, everything like that.
