Coinbase CEO says CLARITY Act will protect crypto users from another FTX collapse

Coinbase CEO Brian Armstrong is making the case for a new bipartisan cryptocurrency bill backed by President Trump, telling CBS News on Thursday that it will broaden consumer protections and prevent a repeat of the FTX fallout. 

"The current status quo today is that there isn't much clarity about what the rules are. And so we are seeing a lot of ordinary Americans get harmed by using some of these products," Armstrong said in an interview with CBS News anchor and MoneyWatch correspondent Kelly O'Grady. "So this bill creates lots of consumer protections."

The CLARITY Act, which is scheduled for a Senate vote in September, would create a regulatory framework for cryptocurrency, providing more oversight to an industry that has, up until now, been largely operating in a legal gray area. Under the bill, which the House passed last year, the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission would jointly regulate digital assets.

Armstrong believes the new guardrails would benefit the financial services sector, make the U.S. more competitive and enhance protections for ordinary crypto users. FTX, a one-time darling of the crypto world, collapsed in 2022 after its founder, Sam Bankman-Fried, misappropriated customer funds.