According to Michaël van de Poppe, excessive regulation of the crypto industry would negatively affect markets and encourage decentralized finance (DeFi).
The failure of the CLARITY crypto market structure bill to advance in the United States Congress is positive for crypto markets and the industry, according to market analyst Michaël van de Poppe.
Van De Poppe said crypto exchange Coinbase withdrew support for the bill on Wednesday and X Coinbase CEO Brian Armstrong publish citing several problems with the latest version of the bill.
Issues included a “de facto ban” on tokenized stocks, government access to user records on decentralized finance (DeFi) platforms and a ban on yield-generating stablecoins, Armstrong said. Van De Poppe he said:
“I think if the bill was approved in its current form, it would have a very bad impact on the markets in general. So now all parties are aligned to continue the debate. It reminds me a lot of the Market for Crypto Assets (MiCA) regulations in Europe.”
MiCA, the comprehensive crypto regulatory framework for the European Union (EU), also took several rounds of negotiations and revisions before the final version was passed into law, according to Van De Poppe.
Adopting a US crypto market structure framework is a major policy goal of the crypto industry and its allies in Congress, who are pushing for clear rules of the road for onchain financing.
Related: The crypto industry is divided over the CLARITY Act after Coinbase broke ranks
Coinbase CEO denies rumors of tension with White House, says CLARITY talks underway
The White House has threatened to drop support for the CLARITY Act in response to Coinbase withdrawing its support for the bill, independent crypto reporter Eleanor Terrett reported on Saturday.
Armstrong denied the report and said negotiations were underway to draft a version of the bill that would satisfy the crypto industry and local banks.
The White House has been “super constructive” during the process, Armstrong said he said. His post sparked a series of responses that were critical of the banking sector and the ban on yield-producing stablecoins.
“Don’t let them kill stablecoin yields. That would set back the stables by a generation. Hold the line,” venture capitalist Nic Carter he said.
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