Coinbase CEO Brian Armstrong told lawmakers his exchange cannot support a major draft crypto regulation bill in its current form. Armstrong argued the Senate proposal contains too many issues and could leave the industry worse off than the status quo.

The bill aims to clarify when digital tokens are securities or commodities, assigning spot market oversight to the CFTC. Armstrong says provisions would effectively ban tokenized equities, weaken the CFTC's role, and kill rewards on stablecoins, a core Coinbase product.

Without Coinbase's backing, the Senate Banking Committee's ability to advance the measure is uncertain. The exchange has shaped U.S. crypto policy for years and spent millions supporting pro-crypto candidates. Armstrong said the company would rather have no bill than a bad one.

A Senate markup session is scheduled to discuss amendments. Coinbase's opposition complicates an already contentious debate over digital asset oversight, as lawmakers race to craft rules for the fast-growing industry. Negotiations could still yield changes before a final vote.