The Crypto Debate: Trump, Coinbase and a Family Firm

A new bill regulating crypto markets has ignited heated battles in Washington.
Top officials from the Trump administration have taken a strong stance against Coinbase, the leading crypto company that recently announced it would withdraw support for the bill.

The Fallout

• Coinbase’s CEO, Brian Armstrong, was dubbed a “nihilist” by some Trump allies and even faced suggestions to leave the U.S.
• World Liberty Financial, co‑founded by President Trump, has openly backed Coinbase’s position.
• CEO Zach Witkoff praised Armstrong at a Mar‑a‑Lago event, stating the firm “applauds” his approach.
• During a forum, Witkoff declared that World Liberty is “super aligned” with Coinbase’s ideas.

The Core Issue: Stablecoins

Stablecoins—digital currencies pegged to the U.S. dollar—are at the heart of the dispute.

• Coinbase offers a ~4 % yield on its USDC stablecoin, a program that banks fear could undermine low‑interest bank accounts.
• World Liberty has its own stablecoin, USD1, aiming to let users earn rewards while using it in apps.
• The firm has launched a marketplace app for lending, borrowing, and earning on USD1.
• Plans are underway for a Venmo‑style payment app.

Both companies seek to keep stablecoin rewards legal, so they support each other in Washington. World Liberty’s co‑founder Zak Folkman emphasized the firm is “very much aligned” with Coinbase.

Political Ramifications

Coinbase’s abrupt withdrawal shocked Congress and the White House, prompting Republican lawmakers to cancel a key Senate vote. The bill now hangs in limbo and may not pass before the midterm elections slow congressional activity.

Despite frustration, Trump officials have still met with Coinbase and other crypto firms to negotiate stablecoin yields. They view the bill’s passage as a top priority for spring.

If the market‑structure bill fails, stablecoin rewards could still be protected under last year’s GENIUS Act. World Liberty claims independence from the White House, yet its actions reveal a close link to Washington politics.