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Coinbase Urges US Officials: Blockchain Isn’t The Enemy — It’s The Solution

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Coinbase has urged US regulators to replace how they struggle monetary crime within the crypto house, arguing trendy instruments can provide legislation enforcement clearer leads whereas chopping low-value paperwork for trustworthy companies.

According to a letter dated October 17, 2025, the corporate requested Treasury officers to just accept new approaches that use blockchain analytics, synthetic intelligence, APIs, decentralized identifiers and privacy-preserving proofs.

The submitting is a part of a public remark course of tied to a Treasury discover searching for concepts on “Innovative Methods to Detect Illicit Activity Involving Digital Assets.”

Coinbase Pushes Tech-Friendly Rules

In the submission, which runs about 30 pages, Coinbase’s Chief Legal Officer Paul Grewal proposed a number of sensible steps. Reports have disclosed requests for safe-harbor testing zones the place companies might strive new monitoring instruments with out rapid enforcement danger.

The firm requested Treasury to acknowledge decentralized IDs and zero-knowledge proofs as legitimate methods to confirm clients, and to help standardized APIs so exchanges and regulators can share the precise information.

Grewal wrote, “When unhealthy guys innovate in monetary crime, good guys want innovation to maintain tempo.” That line was used to underline the corporate’s level that conventional, form-driven reporting can miss actual threats.

Why Coinbase Says Change Is Needed

According to Coinbase, present guidelines below the Bank Secrecy Act generate huge quantities of suspicious exercise alerts, a lot of them low worth, and go away each companies and regulators overwhelmed.

The agency argued a results-based strategy would concentrate on outcomes — like whether or not illicit exercise was truly detected and stopped — as an alternative of forcing particular, typically outdated strategies on each actor.

Reports present Coinbase additionally framed this as a nationwide competitiveness challenge, pointing to a white paper from its policy arm titled “The National Security Case for Crypto and Blockchain.”

Privacy And Data Concerns

At the identical time, privateness advocates and a few civil liberties teams have raised purple flags. Blockchain tracing can expose transaction hyperlinks that have been beforehand tougher to find, and activists fear about overreach.

Coinbase instructed Treasury it needs fewer blanket information grabs and extra focused, significant reporting — a transfer it says would shield privateness whereas bettering enforcement.

Featured picture from Gemini, chart from TradingView

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