What role does Coinbase play in the adoption of Bitcoin and its effects on USD?

Coinbase CEO: How Bitcoin Uniquely Strengthens USD’s Reserve Status

Introduction: Bitcoin as a Dollar-Positive Innovation

Coinbase CEO Brian Armstrong has repeatedly argued that embracing crypto innovation-especially Bitcoin-reinforces U.S. economic leadership and the dollar’s reserve-currency role. In 2024-2025, that thesis became more tangible: U.S.-listed spot Bitcoin ETFs drew global capital into dollar markets, CME’s dollar-settled Bitcoin futures deepened institutional access, and a growing share of Bitcoin’s mining, custody, and compliance stack remains anchored in the United States. For a crypto-native audience, the takeaway is clear: Bitcoin does not threaten the dollar by default-handled correctly, it can extend USD dominance into the digital age.

Bitcoin’s USD Gravity: Pricing, ETFs, and Derivatives

Bitcoin’s global market structure naturally centers on USD liquidity, which pulls activity, fees, and settlement into dollar rails.

• U.S. spot Bitcoin ETFs (approved in January 2024) trade in dollars on U.S. exchanges, drawing worldwide inflows via USD-denominated products.
• CME-listed Bitcoin futures (cash-settled in USD) are among the largest institutional BTC derivatives venues, aligning risk management and reporting with U.S. standards.
• Major venues quote BTC/USD as a primary pair, making the dollar the reference unit for price discovery and analytics.

Why Armstrong Says Bitcoin Can Strengthen USD Hegemony

Armstrong’s thesis is less about ideology and more about market plumbing and incentives:

1. Dollar-Denominated Access Points: The largest, most trusted Bitcoin access products-ETFs, regulated futures, and qualified custody-are U.S.-centric and dollar-denominated, channeling international savings into USD instruments.
2. Regulatory Gravity: Clear, workable rules (SEC/CFTC coordination, sensible disclosures, and strong custody standards) keep liquidity onshore and in dollars instead of pushing it to non-USD jurisdictions.
3. Network Infrastructure at Scale: The U.S. hosts a significant share of hash rate, institutional custody, and security vendors. That anchoring increases U.S. influence over best practices and compliance norms that spill over into dollar usage.
4. Positive Spillovers to the U.S. Financial System: Fees, spreads, taxes, and service revenues around Bitcoin accrue in USD and fund further U.S. innovation across fintech, exchanges, and security.

Stablecoins Complement the Bitcoin-USD Flywheel

While Bitcoin is distinct from stablecoins, Armstrong often links the two to the same outcome: preserving the dollar’s primacy. USD stablecoins like USDC enable instant dollar settlement across crypto rails, often acting as the bridge between BTC and fiat. This makes the dollar the default operating currency of crypto markets even when transacting with non-dollar users.

Policy Priorities That Matter in 2025

The policy choices the U.S. makes now will determine whether Bitcoin continues to reinforce dollar leadership.

• Clarity on Asset Classification: Consistent SEC/CFTC boundaries reduce regulatory arbitrage and keep liquidity in USD venues.
• Prudent Market Structure Rules: Transparent listing standards, surveillance-sharing, and robust custody lower systemic risk without stifling innovation.
• Stablecoin Statute: A federal regime for high-quality, fully reserved USD stablecoins aligns crypto settlement with U.S. banking and payments oversight.
• Tax Simplicity: Reasonable reporting rules and de minimis exemptions for small transactions push more activity onto U.S. rails, boosting dollar velocity.

Risks, Misconceptions, and the Competitive Landscape

Critics argue that Bitcoin competes with the dollar as a store of value. Armstrong’s counterpoint is practical: reserves status flows from network effects-liquidity, infrastructure depth, legal predictability, and global access. By those measures, U.S.-anchored Bitcoin markets are dollar-positive.

Key considerations

• Dedollarization Narratives: While some nations explore non-USD settlements, crypto’s most liquid markets still lean USD. The priority is to keep the deepest BTC liquidity and benchmarks in dollar terms.
• Jurisdictional Competition: If rules push innovation abroad, BTC liquidity may concentrate in non-USD hubs. Predictable U.S. policy keeps the center of gravity in dollars.
• Operational Risks: Custody failures or opaque venues erode trust. Strong U.S. standards mitigate contagion and protect the dollar’s credibility in crypto.

What This Means for Builders and Institutions

For crypto-native teams and traditional institutions, a dollar-forward Bitcoin strategy can serve both adoption and policy goals:

• Offer USD-denominated Bitcoin products with best-in-class disclosures and surveillance.
• Integrate high-quality USD stablecoins for settlement and treasury operations.
• Adopt rigorous custody, audit, and resilience practices to align with U.S. institutional requirements.
• Engage constructively on rulemaking to maintain onshore liquidity and innovation.

Conclusion: Bitcoin as a Force Multiplier for USD Leadership

Armstrong’s view resonates because it matches market reality: Bitcoin’s largest and most influential access points, benchmarks, and liquidity pools are dollar-based. With thoughtful regulation, Bitcoin becomes a force multiplier for USD leadership-expanding the dollar’s reach into the open, programmable financial system being built on crypto rails. The strategic move for the U.S. isn’t to resist Bitcoin-it’s to lead it, in dollars.