Coinbase criticized Brazil’s proposed stablecoin regulation, warning it could hinder adoption and affect users. Tom Duff Gordon emphasized that concerns over stablecoin misuse could be addressed with alternatives that support user autonomy. The regulation aims to outlaw withdrawals to self-hosted wallets, complicating the decentralized finance landscape.
Coinbase has voiced strong opposition against a proposed regulation in Brazil targeting the usage of stablecoins. Tom Duff Gordon, the Vice President of Coinbase, emphasized that concerns surrounding stablecoin misuse can be addressed without hindering their adoption or affecting legitimate users. While he acknowledged the Brazilian central bank’s initiative to consult the public prior to the regulation, he criticized its extensive reach, which threatens the ability to utilize stablecoins within the nation.
The central bank’s proposal seeks to ban withdrawals of stablecoins to self-hosted wallets, driven by fears of their potential involvement in activities such as money laundering and tax evasion. Gordon highlighted the detrimental impact such measures would have on the market, stating that stablecoins are crucial for the evolution of decentralized finance (DeFi) and the future internet.
During the public consultation regarding these impending regulations, Coinbase has presented alternative solutions to alleviate the central bank’s concerns while still permitting self-custodial wallets. Gordon reiterated that Coinbase’s participation aimed to show how regulations can be implemented safely, ensuring adherence to anti-money laundering (AML) and know your customer (KYC) practices.
The Brazilian government is focusing on the growing stablecoin market, particularly its use in remittances, and is considering taxing these activities. The proposed ban on withdrawals to self-custody wallets aims to improve tracking and monitoring, but could inadvertently criminalize decentralized finance applications that heavily depend on stablecoins, thereby impeding Brazilians’ legitimate use of these financial instruments.
Coinbase’s opposition to Brazil’s proposed stablecoin regulation underscores the potential negative impact on the cryptocurrency ecosystem. The regulation may stifle innovation in decentralized finance while failing to effectively address issues of money laundering and taxation. By proposing alternatives that ensure compliance with AML and KYC standards, Coinbase seeks to balance regulation with the need for user autonomy in the stablecoin space.
Original Source: news.bitcoin.com
