00:00 Speaker A
Bitcoin climbs back above $93,000 hitting its highest level in two weeks. It’s been a rough run though since hitting that all-time high back in October and a key underlying factor heading into the new year, the regulatory backdrop. Joining me now is Paul Grewall, Coinbase’s chief legal officer. Paul, it’s great to see you. We have a lot of crypto news to cover Paul, and you’re just the guy to talk about it. We let’s come, you know, let’s start with your boss, Paul. Coinbase CEO Brian Armstrong, he’s at the Dealbook conference today, Paul. You saw this. He says he hopes for a Senate vote soon on the Clarity Act. Let’s start there, Paul. Remind us what the Clarity Act is and what it means, Paul, for Coinbase, for your business, for the wider industry.
00:59 Paul Grewal
Well, it’s great to be here. The Senate uh is considering uh their version of the Clarity Act. And what the Clarity Act that passed the house earlier this year, provides for the first time is a true market structure for crypto here in the United States. Uh earlier in the year, uh Congress passed and the president signed a bill on stablecoins, which is an important first step in providing clarity and certainty uh under the law for crypto and digital assets. But it’s really time, it’s essential that Congress finishes the job and that’s what it will do when the Senate finally passes market structure legislation in a short time and the president signs it.
01:46 Speaker A
Paul, you mentioned stablecoins there. Now, Brian Armstrong also spoke about this. He said banks are exploring stablecoins after Congress passed the Genius Act. I’m curious, Paul, what do you think that means for the adoption curve?
02:08 Paul Grewal
Well, there is no doubt that traditional financial institutions including banks now understand very well the power and potential of stablecoins to bring about a transformation in the financial services industry. And what that will mean, of course, is greater adoption, greater utilization and improved efficiency throughout the financial system. Uh we’re happy to see the banks finally waking up to their realization that it’s time for innovation in the way we move money online and we’re happy to have them as partners in this uh in this space and uh look forward to their full participation.
02:52 Speaker A
Now now Paul, it wasn’t just Brian Armstrong your colleague in the Deal book. We had Larry Fink there too. There is another big name. He said Bitcoin, which was interesting. He said Bitcoin remains heavily influenced, says Mr. Fink, by leveraged actors. And I’m just curious what you make of this, Paul. I mean, how much leverage still creates risk here and how does Coinbase mitigate that?
03:25 Paul Grewal
Well, Coinbase has provided access to Bitcoin for millions of Americans which really goes back to the early days of crypto. Uh but it’s a market like any other market that evolves over time and it’s natural to expect that uh individuals who might have been less familiar or even less comfortable uh custody of their own Bitcoin and keep it in their own wallets, will want to rely on intermediaries of all kinds in order to uh participate fully and finally participate in this market. Uh we are seeing leverage and additional intermediaries that rely on leverage, introducing uh new options for consumers to participate uh in the Bitcoin revolution. Uh uu this obviously requires there to be new standards, new new requirements and new safeguards put in place. But we think that uh the structural legislation of the market is essential to facilitate this. It will define for the first time which assets are subject to US securities laws and which assets fall outside those laws. And we think that concerns about leverage and many others are best addressed by Congress and the agencies charged with writing the rules once Congress acts.