JPMorgan Chase CEO Jamie Dimon again sharply criticized Coinbase CEO Brian Armstrong on Friday and warned that the latest version of the Clarity Act could ultimately fail if lawmakers do not address traditional banks’ concerns over stablecoin regulation.
In an interview with Maria Bartiromo on Fox Business, Dimon appeared frustrated with the direction of the debate around stablecoins and digital asset legislation. When asked if he was satisfied with the current Digital Asset Market Clarity Act, the crypto market structure bill that would formalize rules for how federal securities and commodities regulators oversee crypto, Dimon said he was not.
“No, because it allows them to effectively pay interest on deposits, stablecoins or something like that, without the protection that they should have,” Dimon said. “The banks won’t accept it that way. … I’m not worried about stablecoins, but if that happens, I tell you, I won’t have anything to do with it and it will eventually explode.”
The comments come amid a growing divide between the banking industry and crypto companies, as lawmakers prepare for a key markup process that will determine whether the Clarity Act can advance in Congress. Lawmakers are expected to continue negotiating provisions governing stablecoin issuers, consumer protections, reserve requirements and whether crypto companies should be allowed to offer yield-producing products that resemble traditional bank accounts.
For the legislation to ultimately become law, it must be approved by the full Senate and House of Representatives and be signed by President Donald Trump. The Senate Banking Committee advanced its version of the bill through markup earlier this month, and the Senate Agriculture Committee advanced its own version earlier this year. Currently, representatives from the two committees are merging the bills, a key step before the full Senate can consider them.
At the center of the dispute that has dragged out the Banking Committee process is the issue of stable rewards. Armstrong and Coinbase argued that traditional banks are pushing lawmakers to restrict stablecoin rewards programs, which operate similarly to high-yield interest accounts and could threaten banks’ deposit-based business models. Banking industry executives, meanwhile, argue that companies offering bank-like products should be subject to comparable oversight and regulation obligations.
The disagreement became a key reason legislation stalled in Washington and failed to gain sufficient momentum earlier this year, despite broad bipartisan interest in creating a regulatory framework for digital assets.
Tensions between Armstrong and Wall Street executives have been growing for months. In meetings at the World Economic Forum in Davos earlier this year, Dimon told Armstrong, “You’re full of crap,” according to people familiar with the matter who spoke to The Wall Street Journal.
Bank of America CEO Brian Moynihan reportedly dismissed Armstrong’s arguments, telling him, “If you want to be a bank, just be a bank.” » Charlie Scharf, CEO of Wells Fargo, refused to engage, while Jane Fraser, CEO of Citigroup, spent less than a minute with him, according to an earlier report.
Coinbase and JPMorgan did not respond to requests for comment in time for publication.
