Morning Minute: Coinbase Withdraws Support of Clarity Act, Markup Delayed

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.

GM!

Today’s top news:

• Crypto majors are green again with Bitcoin at $96,750
• Bitcoin ETFs see $1.54B in net inflows over past 2 sessions, most in months
• Coinbase withdraws support from Clarity Act draft, markup delayed
• FUN and FOGO both TGE today along with airdrops for users
• Myriad announced partnerships with WLFI and MoonPay for USD1 markets and a new in-app wallet

🏛️ Coinbase Breaks With Washington Over the Clarity Act

And now the future of the bill is in question.

📌 What Happened

Coinbase publicly withdrew its support for the Senate’s crypto market structure legislation (the Clarity Act), just days before a key vote.

In a tweet, Coinbase CEO Brian Armstrong said the company “can’t support the bill as written,” arguing the updated version would leave the industry worse off than the status quo.

Armstrong outlined several core objections:

• A de facto ban on tokenized equities
• DeFi prohibitions that would give the government broad access to user financial data and erode privacy
• An erosion of the CFTC’s authority, effectively strengthening the SEC’s hand and stifling innovation
• Draft amendments that would eliminate rewards on stablecoins, allowing banks to block competition from crypto-native payment rails

Coinbase emphasized that while it appreciates the bipartisan effort behind the bill, this version “would be materially worse than the current status quo.”

Notably, the Senate Banking Committee delayed the vote in the late hours of the evening following Coinbase’s withdrawal.

🗣️ What They’re Saying

“It probably speaks to the size and influence of Coinbase on Capitol Hill that I’m hearing rumblings the markup could be pulled tomorrow after CEO Brian Armstrong announced he was withdrawing the company’s support for the bill an hour ago.” – Eleanor Terrett, Host of Crypto in America

“We’d rather have no bill than a bad bill.”

• Brian Armstrong

  For months, the Clarity Act was framed as a long-awaited breakthrough: clear rules, bipartisan support, and a path to finally moving crypto out of regulatory limbo.

It seemed we were closer than ever to getting the bill across the finish line.

But these latest changes seem to be too big to compromise on.

Three big implications stand out:

• First, the Banking influence is becoming harder to ignore.
  The proposed limits on stablecoin rewards and tokenized equities align closely with bank lobbying priorities, and not in crypto’s best interest.
• Second, DeFi and tokenization are clear threat vectors.
  DeFi is too important to crypto to be compromised on, and tokenization and onchain equities is arguably one of the most interseting growth sectors in all of crypto. We need to get these right.
• Third, the industry is no longer willing to accept “something is better than nothing.”
  Coinbase’s stance signals a shift in confidence. With ETFs approved, institutions onboarded, and global markets opening up, U.S. crypto companies are less desperate for a deal at any cost. Walking away is now a credible option.

While this is certainly a hurdle, there is light at the end of the tunnel.

Brian Armstrong himself followed up his statement by saying:

“I’m actually quite optimistic that we will get to the right outcome with continued effort. We will keep showing up and working with everyone to get there.”

So hopefully a deal can still get done. But the clock is ticking with Midterms looming…

🌎 Macro Crypto and Markets

A few headlines that stood out:

• Crypto majors are very green with Bitcoin making a new another 2-month high; BTC +2% at $96,7500; ETH +2% at $3,360, SOL even at $145; XRP -1% to $2.11
• DCR (+30%), DASH (+10%), ICP (+10%) and ZEC (+7%) led top movers; XMR hit another new ATH at $800 before retracing to $725
• Coinbase pulled support for the Senate’s crypto market structure bill ahead of a key vote, citing major concerns with the latest draft, leading to the Senate delaying the bill
• Zcash avoided SEC action after the Zcash Foundation said the agency’s investigation has concluded
• Ripple secured a Luxembourg license as its European expansion continued
• Pakistan teamed with World Liberty Financial to explore stablecoin use cases for remittances and cross-border payments
• The Human Rights Foundation awarded nearly $1.3M in Bitcoin grants to projects tied to human rights and freedom tech
• Figure unveiled a new public equity network designed to enable on-chain issuance of stocks and related assets
• FTX prepared another round of creditor payments and outlined timing details for the next distribution on March 31
• Sui came back online after a nearly six-hour network stall, marking another reliability test for the chain

In Corporate Treasuries / ETFs

• The BTC ETFs saw $840.6M in net inflows on Wednesday, now with $1.54B over the past 2 sessions; ETH ETFs saw $175M in net inflows
• Bitwise launched a Chainlink ETF as LINK jumped to its highest level in a month

In Memes / Onchain Movers

• Meme majors were very red and giving back yesterday’s gains; Doge -2%, Shiba -2%, PEPE -8%, TRUMP -3%, Bonk -5%, Pengu -3%, SPX -2%, WIF -6% and Fartcoin -9%
• Buttcoin (+170%), Grandma (+11x) and 67 (+23%) led notable onchain movers; KLED jumped 80% to $44M

💰 Token, Airdrop & Protocol Tracker

• Myriad announced a new partnership with WLFI to enable USD1 markets, as well as a new wallet powered by MoonPay to enable easier onboarding
• MetaMask teased something “coming soon,” renewing token hopes
• OpenSea partnered with MetaMask to give additional rewards points for those who download the wallet and sign in to OpenSea
• Lighter announced LIT staking, granting access to their LLP
• Football dot Fun’s FUN token and airdrop goes live today, as does the FOGO token in a big day for TGEs
• Ace Trader introduced its $1M trading competition with public access starting Jan 19-26 for those who want to compete for a seat
• Noise raised $7.1M seed round led by Paradigm

🚚 What is happening in NFTs?

• NFT leaders were mostly flat on the day; Punks -1% at 28.8 ETH, Pudgy even at 5.13 ETH, and BAYC +1% at 5.93 ETH; Hypurr even 508 HYPE
• Infinex Patrons (+18%) led notable top movers
• Moonbirds published their “birbillions thesis” laying out the plan for the company to generate $1B in revenue