Coinbase opposes a proposed Brazilian regulation on stablecoins that would limit their use and prohibit withdrawals to self-hosted wallets. VP Tom Duff Gordon highlighted the importance of stablecoins for decentralized finance and suggested alternatives to address regulatory concerns without impeding adoption.
Coinbase has voiced its opposition to a proposed regulation in Brazil that would significantly impede the utilization of stablecoins. Tom Duff Gordon, the Vice President of Coinbase, acknowledged the Brazilian Central Bank’s willingness to engage in consultation before implementing new measures, yet criticized the broad implications of the proposal. He emphasized that the regulation would hinder the ability to utilize stablecoins effectively within the country, directly affecting users who depend on these assets for their operations.
The proposed regulation specifically includes a prohibition on the withdrawal of stablecoins to self-hosted wallets. This measure has been prompted by concerns regarding potential illicit activities, such as money laundering and tax evasion. Gordon expressed his belief that the Central Bank should reconsider its position, highlighting the importance of stablecoins for the future of the internet and decentralized finance, where self-custodial wallets are pivotal.
In response to the regulatory proposal, Coinbase has submitted alternative solutions during the public consultation process. Gordon noted, “In our response to the BC’s public consultation, we presented arguments on how this model can be implemented safely, addressing legitimate concerns about AML (anti-money laundering) and KYC (know your customer) practices.”
Brazilian officials have become increasingly focused on the stablecoin market, particularly in light of its growing popularity for remittance payments last year. The move to restrict stablecoin withdrawals aims to enhance tracking capabilities, as monitoring transactions involving self-custody wallets poses significant challenges. This proposed ban could inadvertently classify decentralized finance applications as criminal, thereby limiting their use for legitimate purposes among Brazilian users.
In summary, Coinbase has raised substantial objections to the proposed stablecoin regulation in Brazil. The cryptocurrency industry leader advocates for alternative solutions that address regulatory concerns while promoting the growth of decentralized finance. As the central bank considers its next steps, the potential adverse impact on users who utilize stablecoins for legitimate transactions remains a critical aspect of the discussion.
Original Source: news.bitcoin.com
