Coinbase CEO Clashes with French Central Bank Governor at Davos: Stablecoin Yields and "Bitcoin Standard" Take Center Stage

Odaily News At the World Economic Forum in Davos, Switzerland, Coinbase CEO Brian Armstrong and French Central Bank Governor François Villeroy de Galhau engaged in a heated debate over issues such as whether stablecoins should pay yields to holders and the monetary attributes of Bitcoin.

A roundtable discussion originally themed "Does Tokenization Represent the Future?" shifted its focus to stablecoin yield mechanisms, the positioning of Bitcoin, and the legislative progress of the U.S. Senate's crypto market structure bill, the CLARITY Act. Armstrong argued that allowing stablecoins to offer yields to users helps enhance consumer returns and international competitiveness. He pointed out that if regulated stablecoins in the U.S. were prohibited from paying yields, it might inadvertently benefit offshore products.

Villeroy de Galhau took the opposing stance, arguing that private stablecoins with yield-bearing attributes could pose systemic risks to the traditional banking system and financial stability. He explicitly stated that a digital euro should not use yield as a competitive tool, with its core objective being to maintain the stability of the financial system.

On the issue of U.S. legislation, Armstrong emphasized that the CLARITY Act is not stalled but is in a phase of negotiation and strategic maneuvering. He explained that Coinbase's recent withdrawal of support was to oppose the banking industry's attempts to restrict crypto industry competition through lobbying. Ripple CEO Brad Garlinghouse noted that the so-called "level playing field" should apply both ways, with crypto companies and banks both adhering to equivalent regulatory standards.

When the discussion turned to Bitcoin, Armstrong introduced the concept of the "Bitcoin Standard," suggesting it could serve as a long-term option against fiat currency depreciation. Villeroy opposed this view, emphasizing that monetary policy falls within the realm of national sovereignty and warning that private currencies could potentially undermine sovereignty. Armstrong promptly responded by stating that Bitcoin has no single issuer and its degree of decentralization is even higher than that of central banking systems.

Despite the clear disagreements, participants generally agreed that future crypto innovation and regulation will need to find a path of coexistence through ongoing negotiation and interaction. (Coindesk)