Recently, Coinbase CEO Brian Armstrong has voiced his concerns over the U.S. Commodity Futures Trading Commission’s (CFTC) approach towards decentralized finance (DeFi) protocols.
Armstrong firmly believes that the CFTC should abstain from pursuing enforcement actions against DeFi platforms, emphasizing that they are not conventional financial service businesses.
Armstrong’s stance stems from his conviction that the Commodity Exchange Act, under which the CFTC operates, is unlikely to apply to DeFi protocols.
He urged DeFi projects to consider legal action to establish a significant legal precedent, underlining that the courts have consistently upheld the rule of law. He noted that the current course of action could inadvertently drive an essential industry offshore, potentially hindering its growth and development.
Coinbase Embraces Bitcoin’s Lightning Network Integration
Previously, Armstrong reaffirmed Coinbase’s commitment to Bitcoin, hailing it as the “most important crypto asset.” The CEO also confirmed the cryptocurrency exchange’s decision to integrate Bitcoin’s Lightning Network following an extensive consultation process.
Armstrong praised his team for their diligence in exploring this integration, expressing excitement about enabling faster and more cost-effective Bitcoin transactions. Acknowledging that this integration would take some time, he urged users to exercise patience.
The Lightning Network represents a second-layer solution comprising payment channels built atop the Bitcoin blockchain. Its primary purpose is facilitating swift and economical transactions within the Bitcoin ecosystem.
This decision to integrate the Lightning Network followed a consultation process initiated in August, which aimed to gather feedback on the optimal approach to implementation.
Coinbase’s commitment to this endeavor gained momentum after a Twitter exchange between Armstrong and Block CEO Jack Dorsey, who sought insights into Coinbase’s Bitcoin and Lightning Network strategy.
Coinbase’s protocol specialist, Viktor Bunin, spearheaded the initiative, emphasizing the importance of community input regarding support, user experience, open-source tools, service providers, and potential edge cases.
Bunin’s involvement in the process came after a previous Twitter exchange in which he acknowledged his earlier misunderstanding of Bitcoin’s upgrade mechanisms, signaling a commitment to continual learning and improvement.
However, Coinbase’s CEO Brian Armstrong champions DeFi protocols in their quest for legal clarity while doubling down on Bitcoin by embracing the Lightning Network integration, signaling a pivotal moment in the company’s commitment to crypto and blockchain.
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