Coinbase CEO: China Will Beat U.S. in Crypto Arms Race

China may have banned crypto, but it is looking to incorporate it in new ways.

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Created by Gabor Kovacs from DailyCoin
  • Brian Armstrong is continuing his battle against strict U.S. regulations.
  • His latest op-ed has outlined China as a real threat in the tech and finance arms race, especially given a softening approach to crypto.
  • Crypto transactions are still illegal in China, but things could be changing.

Two global superpowers have been surprisingly restrictive in the regulation and proliferation of cryptocurrency technology, but the U.S. may start falling behind rival China in this technological arms race. 

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Coinbase CEO Brian Armstrong, who has been a strong proponent of crypto innovation in the currently restrictive U.S., believes that China could be the ultimate benefactor of the ‘regulation by enforcement’ approach in the U.S.

See the Bigger Picture

In a May 30 op-ed for MarketWatch, Armstrong outlined the dangers of writing off crypto and its associated technology. For Armstrong, regulating crypto into the ground could leave the U.S. lagging in its bid to be a financial leader and innovation hub.

Armstrong urged regulators to see more in crypto, not just its offerings for individual transactions. Armstrong offered a number of sectors that could be impacted by positive crypto regulation in the U.S.

“Crypto, like the internet before it, has the potential to modernize finance and numerous other sectors, from supply chains to social media, by offering a faster, cheaper, more private, and accessible platform,” Armstrong explained. 

An “Ambitious Adversary”

Armstrong has been actively combatting the SEC in a lawsuit, but he has also been an advocate for regulatory clarity in the U.S. in general. Not only is Armstrong looking for clarity for his own operations at Coinbase, but he is looking out for the U.S.

“Today, the U.S. and other democratic nations are up against digital systems promoted by an ambitious adversary, China,” Armstrong explained. He outlined how companies like  Alipay and Tencent, offer integrated payment systems and how the government in China has launched its digital yuan.

China Changing Its Tune?

Many will see China as an odd adversary in the crypto arms race, given the nation outlawed crypto transactions in 2021. However, there is strong evidence that China may be softening its views. 

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On Sunday, May 29, the Chinese government released a white paper on Web3, outlining the country’s plans for new internet technologies. While there is no mention of cryptocurrencies, many feel that these digital tokens are indivisible from Web3. 

Moreover, Hong Kong is introducing a licensing regime on 1 June that is to allow retail investors to buy crypto-tokens with large market capitalizations, such as Bitcoin and Ether. And while the special administrative region of China is separate from the mainland, it seems to show a softening approach. 

Read more about Coinbase’s battles with the SEC:

Will Coinbase’s Lawsuit Against the SEC Affect Its Ongoing Enforcement?

Read more Solana’s Attempts to be the Next Apple:

“Solana has Potential to Be Apple of Crypto”: Co-Founder Gokal Claims

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Darryn Pollock

Darryn Pollock is a South African-born, UK-based journalist and content writer for DailyCoin with a focus on regulation and legislation revolving around the cryptocurrency space. He has covered the evolving crypto regulatory space, and examined how the US has approached law-making to offer protection in the growth of innovation. Darryn values traditional journalistic principles of truth, accuracy, independence, fairness, and impartiality, and has a Bachelor of Arts degree in Journalism and Law from Rhodes University in South Africa.