Last man standing in crypto having his day in court
Brian Armstrong has become the new face of crypto.
Coinbase Global, the cryptocurrency exchange he cofounded in the US in 2012, is one of the last big digital-asset companies standing after a string of high-profile collapses and government crackdowns.
Armstrong’s former rivals — FTX founder Sam BankmanFried and Binance founder Changpeng Zhao, who once boasted far greater influence and wealth – are either in jail or facing time behind bars.
Armstrong has continued expanding Coinbase despite the industry slowdown and a long string of unprofitable quarters. As chief executive, he has pushed the company into overseas markets, launched new products and forged business ties with Wall Street asset managers to try to become less reliant on crypto trading revenue.
Notably, Coinbase is serving as the custodian for eight of the spot bitcoin exchange-traded funds that started trading last week. Its custody arm is responsible for safekeeping the bitcoin and will receive a fee based on the total value of the funds’ assets.
Armstrong has also become increasingly brash in the face of US regulators’ effort to rein in the crypto industry. Armstrong spent significant time in Washington DC, last year lobbying for crypto legislation.
He hired former lawmakers as advisers and donated $US1m ($1.5m) of his personal wealth to a pro-crypto super politicalaction committee.
The first test comes on Wednesday when Coinbase will ask a federal court judge to dismiss the high-stakes lawsuit brought against the company last year by the Securities and Exchange Commission. The agency sued Coinbase in June for allegedly offering and listing unregistered securities.
Industry watchers say the request for dismissal is a long shot. The SEC has long argued that most crypto tokens are securities, and selling securities to the broader public without registering them with the SEC makes the issuer liable for violating investor-protection laws.