Chime offers fee-free banking with no overdraft or monthly fees, access to thousands of fee-free ATMs, up to $1,150 in annual rewards, 5% cash back on purchases, a 3.75% APY on savings, premium travel perks, and early pay access. Rated five stars by USA Today. Join millions banking fee-free at chime.com/srs.
Brian Armstrong, welcome to the show.
Oh, my pleasure. I've been looking forward to talking to you. You have a lot going on, even outside of crypto. But first, an introduction: Brian Armstrong, co-founder and CEO of Coinbase, the world's leading cryptocurrency exchange. A Rice University alumnus with degrees in computer science and economics, his engineering background at Airbnb and early startup experience laid the foundation for revolutionizing finance. He transformed a passion for Bitcoin into a publicly traded company in the S&P 500, driving economic freedom through blockchain. He's also founder of New Limit and Research Hub. I also wanted to share some stats: only 9% of Americans are satisfied with the current financial system, 38% of young people say crypto can increase economic opportunities, and crypto prices are up 90% year-to-date. There you go. Interesting statistics. So, before we get going, everybody gets a gift.
So, I got you a couple gifts. Here's the first one: Vigilance gummy bears. Legal in all 50 states. Just candy, red dye and sugar. And I heard you're a firearms enthusiast, so I got you a Sig Sauer P226 Legion. That's the upgraded model of what all SEALs were issued. All metal, great trigger, gas pedal, helps keep the nose down. I think you'll really like it.
All right. Thank you. It's California, so we'll need to handle the transfer.
You're welcome. And I also have a gift from you? You said you brought something?
I brought you a gift too. This is a Satoshi Nakamoto commemorative card, one of 21. It's a Bitcoin credit card that gives 4% back in Bitcoin. On the front is a copy of the Bitcoin Genesis block, which includes an encoded headline from the 2008 financial crisis: 'Chancellor on the brink of bailouts.' It's kind of a statement that Bitcoin is an answer to bank bailouts. So you can use it to get cash back in Bitcoin.
Oh man, thank you. This is awesome. I'll get you to sign it and frame it. And we'll get one hooked up to your Coinbase account for everyday spending.
I do want to talk about who Satoshi is. But first, one last thing before the interview. I have a Patreon account with a community of 90,000 people. One of them, Achilles Actual, asks: 'What measures is Coinbase taking to prevent cryptocurrency theft? And how is the company addressing concerns that quantum computing could compromise blockchain security?'
Great questions. We use multiple strategies to prevent theft. For customer funds stored on Coinbase, we use cold storage – generating keys in secure facilities across ally countries, requiring consensus from multiple keys to move funds. We also have a self-custodial wallet for those who don't want to trust us. Regarding quantum computing, post-quantum cryptography is an area of research. Quantum computers could break current encryption, but that would affect banking, military, etc., not just crypto. Upgrade proposals are being discussed. I think we need a solution in place within 3-5 years to be safe, as quantum may arrive in 5-10 years. Coinbase will help ensure funds are quantum-resistant.
So you think quantum computing will come into play in about 5 years?
Well, I'd want a solution in place before then. It might take 10 years, but I'd rather be ahead. If China gets one, we might see money moved unexpectedly. It's something to get ahead of.
Mhm. Yeah, a lot of talk about quantum computing lately. But I'm fascinated with innovators like you. Let's start at the beginning: where did you grow up?
I grew up in San Jose, California. Both my parents were engineers – my mom a programmer at IBM, my dad a civil engineer at Lawrence Livermore. I was a shy, introverted kid who loved computers. I didn't know what I wanted to do, but I was a total geek.
What age did you start getting interested?
Pretty young. In middle school I was trying to learn programming. In high school, I took classes at the local community college. I would stay up until 2 or 3 AM learning how computers worked and then be sleep-deprived at school. It was a signal I was more interested in that than what they taught.
What else were you into? Sports? Outdoors?
Well, I lived next to a park, so I spent time outdoors with my dog. But I wasn't athletic. I tried tennis, liked running, but never team sports. I was introverted.
Where'd you go to school?
I went to Bellarmine, a private Jesuit all-boys school in California. It had a mission of 'men for others' which influenced me. They required volunteer service. Later, building companies became my way of creating value. After that, I applied to schools. I wanted to leave California for independence. I didn't get into MIT or Harvard, but I got into Rice University and visited and really liked it. I studied computer science and economics. I remember the first econ class: economics is the study of scarcity – if you want more of something, you have to have less of something else. The combination of computer science and economics was perfect for crypto.
Interesting. So I know you went to Argentina. Was that to study?
After college, I was seeking adventure. I had tried starting a tutoring company that wasn't going well. I wanted to go abroad and put myself out of my comfort zone. I went to Buenos Aires as a first stop, planning to spend a month in each city, but I settled there for about a year. It was lonely at first, but I learned Spanish and met people. I saw a society that had gone through hyperinflation. People would get their paycheck and immediately spend it because it might be worth less tomorrow. Coins became scarce. It destroyed optimism. That experience made Bitcoin click for me later – the need for sound money.
What was in the white paper that got you fired up?
I read the Bitcoin white paper in December 2010 on Hacker News. It described a decentralized currency with no country or company controlling it, provably scarce like gold. Peer-to-peer transactions with no intermediary. It immediately captivated me. I had been reading Ayn Rand and Milton Friedman, and the idea appealed to me. I was working at Airbnb and saw how broken moving money globally was. So I couldn't stop thinking about it for six months, reading everything, going to early Bitcoin meetups in San Francisco. Those meetups were a motley crew: anarchists, PhDs, homeless people. After six months, I started working on a prototype nights and weekends that became Coinbase.
Interesting. Who is Satoshi Nakamoto?
Nobody knows for sure. I think it's likely Hal Finney, a computer scientist who passed away, possibly with collaborators like Nick Szabo. They might have used a pseudonym to avoid being hauled before Congress or killed. They mined a lot of early Bitcoin worth a fortune, so they knew their family would need security. But regardless of who Satoshi is, the idea stands on its own – like a scientific theory. The breakthrough is the first purely digital good that is provably scarce. For example, you can copy a photo infinitely, but Bitcoin's algorithm guarantees scarcity. No one has broken it in 13 years, even nation-state actors. The mathematics is solid.
Can you talk about printing money out of nothing? Sounds familiar. I want you to talk about the Federal Reserve when we came off the gold standard and what's happened.
This is a fascinating topic. Historically, reserve currencies start backed by a hard commodity like gold. During crises, countries temporarily detach from that commodity, then overprint and lose reserve status. In the US, dollars were backed by gold until the 1930s when you couldn't exchange anymore, then fully detached in 1971 under Nixon as a temporary measure that never reversed. That allowed budget deficits and led to inflation. If the dollar continues to lose discipline, people may flee to Bitcoin, gold, real estate – provably scarce assets. That's why we're seeing all-time high Bitcoin prices.
Have we lost all discipline? Is America in decline?
That's a big question. Trust in institutions is at all-time lows. I think the future is not guaranteed. There are moments where a great leader can change course. Around crypto, President Trump has done good stuff after the last administration waged war on it. I hope America is not in decline – it would be a damn shame. If America falls, who takes the mantle? China is not aligned with our values. We should try to save it, but also have alternatives like Bitcoin, Mars, or special economic zones.
I don't think America's in decline. We're at a pivotal moment where if we don't turn the ship around, we'll enter decline quickly. But we've been through crazy times before and landed on the moon. No matter how screwed up America is, everywhere else is kind of worse.
Yeah. I mean, we have the best innovators in the world. Innovators are fired up about the current administration gutting bureaucracy and letting them innovate. I'm all for it. We need to deregulate to build nuclear fusion, supersonic jets, accelerate biotech. Overregulation freezes progress. The government should just run the military, police, courts – everything else the private market can solve better. Competition breeds excellence.
So the incentives aren't aligned for the government to do good things. They should be small, focused on what they have to do, the monopoly on violence, and then let the free market cook. And I think that would be a stronger America.
Me too. Me too. So what's the war on crypto? I'm not.
I can't say I'm not a crypto guy because I buy it, even though I don't understand it nearly to your level. But why would there be a war on crypto?
Well, crypto is a threat to some people in power. In this last administration, Elizabeth Warren and Gary Gensler were the biggest architects of this war on crypto. Elizabeth Warren is a socialist who thinks the government should run all financial services. She applies pressure to big banks to get stuff done she can't pass through Congress, like pressuring JPMorgan not to lend to oil and gas or gun companies. This soft power, called Operation Choke Point 2.0, debanks people for political reasons. Crypto exists outside that power structure, allowing financial transactions without the risk of being shut off by your bank. She hates crypto, but it's hypocrisy because she blocks legislation that would protect consumers. She appointed Gary Gensler as SEC chair, and he flipped on crypto, going from teaching at MIT about its potential to attacking the industry, just to become Treasury Secretary. He created lawfare against crypto companies. When we went public in 2021, the SEC approved everything, but after pressure from Warren, they started sending nasty letters and eventually sued us without pointing to any specific rule violation. We met with them 30 times, and they wouldn't give us guidance. I decided to fight because giving in would kill the entire crypto industry in America. The litigation depressed our stock price, but we fought for two and a half years, spending about $50 million on legal fees. When the Trump administration came in, the SEC chair threw out the case without any penalties. We didn't change anything. It was pure lawfare, and many startups died because they couldn't afford legal costs. But we learned to become politically engaged. We created Standwithcrypto.org, a grassroots campaign that organized 2 million Americans to elect pro-crypto candidates. We now have the most pro-crypto Congress ever.
Yeah. So he totally flopped.
I think these guys are mentally willing to change their values for personal advancement, to get the job they want. He went in and created lawfare against crypto companies. After we went public, the SEC approved everything, but then they started sending nasty letters and sued us. We met with them 30 times, and they wouldn't give us any guidance. I decided to fight because giving in would hurt our business and kill the entire crypto industry in America. A lot of crypto activity was going offshore anyway, and American consumers were using platforms like FTX that blew up and stole money. I thought, 'Are we just going to seed this entire industry to foreign companies?' So we fought, and it took about two and a half years. The SEC pressured banks not to work with us. I was even worried about personal criminal charges, but luckily that didn't happen. When the Trump administration came in, the new SEC chair looked at the case and threw it out. We didn't pay a penny or change anything. It was pure lawfare, and many startups died because they couldn't afford legal fees. But the positive is that we learned to become politically engaged. We created Standwithcrypto.org, which organized 2 million Americans in the last election. They elected pro-crypto candidates, and we now have the most pro-crypto Congress ever. We also helped unseat Sherrod Brown, the anti-crypto chair of the Senate Banking Committee. The crypto community backed Bernie Moreno, and he went from being down 11 points to winning. That sent shockwaves through DC.
We were trying to close deals with big banks to get money moving onto our platform, and the SEC would go meet with them and tell them we were under investigation and they shouldn't work with us. I was worried about personal criminal charges, but it luckily didn't happen. The case got dropped by the new SEC chair. We spent about $50 million on legal fees, but a lot of startups couldn't afford it and shut down.
I mean, I commend you here. That takes some serious balls to go after the SEC.
People told me I was crazy to do it, but I'm glad we did because the crypto industry might not exist in the US today if we had caved. It took about two and a half years, and we spent $50 to $100 million in direct legal fees, and our stock price was in the gutter. It was a huge setback for America. I joked that Gary Gensler should go run the economic development board for the UAE or Bahamas because he grew their economies enormously by pushing crypto businesses offshore.
Wow. And that took how many years?
About two and a half years. It was $50 to $100 million in legal fees, and our stock price was down for a long time. It was a huge setback for America.
Well, it turned into a huge win.
The positive is that we learned how to become politically engaged as an industry. I was naive, thinking we could just follow the law and not deal with politics. But politics came after us. We realized we had to organize our customers, and we created Standwithcrypto.org. In the last election, about 2 million voters showed up, and we now have the most pro-crypto Congress ever. We also created Fairshake, a PAC that raised money to elect pro-crypto candidates. It's bipartisan.
I mean, you set up a fund. Is it $140 million set aside for pro-crypto candidates?
Doesn't matter what side they lean.
Yeah, it's bipartisan. That's a PAC called Fairshake that we were involved in along with others. It has a bunch of money and is helping elect pro-crypto candidates.
How's that? Have you gotten anybody unseated in the Senate or Congress for going against crypto?
The most notable was Sherrod Brown, the sitting chair of the Senate Banking Committee who was super anti-crypto. I flew to DC several times to meet with him, but he refused. We flew in entrepreneurs from Ohio, and he still wouldn't meet. He blocked every attempt at legislation. He was up about 11% in the polls, but we backed Bernie Moreno, and he went from being down 11 points to winning. That was a huge upset that sent shockwaves through DC. We played in about a dozen other races with an 80 to 90% win rate. People realized that being anti-crypto is bad politics because there's no constituency for it, but pro-crypto can get a lot of votes.
Congratulations. But people realized in DC that there's no constituency that wants to vote for anti-crypto. If you're pro-crypto, you can get a lot of votes. The American people want this, so it's bad politics to be anti-crypto.
Have you had anybody that told you they would be pro-crypto and then flipped?
We've had some people that were wishy-washy, like a foxhole conversion where right before an election they'd suddenly say pro-crypto stuff. Maxine Waters was interesting—she was nice to my face but then went on the House floor and attacked Coinbase. She flipped. I don't think she'll be pro-crypto.
How do you educate congressmen, senators, appointees? We're dealing with a lot of dinosaurs. How do you get it to them when even I don't fully understand it?
It's a generational issue. Many members of Congress over 70 don't get it, but their staff have the Coinbase app. I understand they're mile-wide, inch-deep, so they rely on staff and principles like free market. I started going to DC quarterly to build relationships. Initially, we tried to be an educational resource, but that didn't work. It wasn't until we organized millions of voters and had real political power that they started to take us seriously. We tell them crypto updates the financial system—it's faster, cheaper, and gives better rewards. The average savings account pays 0.14%, but treasuries pay 4.5%. Americans want better services. We also use national security arguments: a digital dollar ensures reserve currency status, and we want these industries built in America, not offshore like 5G and semiconductors. Congress now has a strong bipartisan majority that wants to build crypto here. They just passed a crypto bill, and another is expected in September or October.
What do you tell them? Especially with older generations in government, I can't see them wanting to move to crypto.
Well, in many ways, you're right. Crypto is about individual freedom and sovereignty. If you want more power in government, it's unclear why. But the people want it. We talk about updating the financial system—fees are high, overdraft fees, hard to send money, unequal access. Crypto can make payments faster, cheaper, more global, and give better rewards. For example, savings accounts pay almost nothing, but they should get 4.5%. There's also the national security argument: ensuring the digital dollar and keeping industries onshore. It's compelling, and Congress now supports it.
I wanted to ask you about money. We were talking about the Federal Reserve and currencies tied to commodities. What is money to you?
To me, money is a medium of exchange that came from the barter system. It needs properties like scarcity, durability, portability, and divisibility. Gold has some, but Bitcoin is probably the best form of money ever created—it's scarce like gold, but portable and divisible. It's digital gold. Crypto provides a better alternative.
I listen to people like Dave Ramsey, who says crypto is backed by nothing. He's a big finance guy, but he doesn't like crypto.
He's right that it's not backed by anything, but neither is the dollar. Picasso paintings aren't backed by anything either. People value Bitcoin because it's scarce and trust is built through Satoshi's fair launch, the algorithm's security, and the fact that no government has broken it. You could argue it's backed by the energy used to mine it, but ultimately it's about trust. If people trust it and it's scarce, that's all you need.
What are some of the other coins? Is Bitcoin the primary? Why do people hold others like Ethereum, Solana, XRP?
Crypto isn't just one thing. Bitcoin is digital gold. Others like Ethereum and Solana are blockchains that serve as payment and utility layers. There are millions of coins built on top for specific purposes. For example, a company can raise money, or a social media post or podcast episode can be a coin. That's where crypto is going—NFTs were an early version. Now, with our app Base, every piece of content can be a coin with its own market cap, allowing creators to get paid directly by fans.
What do you mean by that?
If you put out a podcast episode, today you have sponsors. But imagine people owning a copy of that episode, like buying a token. That's what we're building with Base. It's a self-custodial wallet that allows anyone with a smartphone to participate, especially in countries with high inflation like Venezuela, Turkey, and Nigeria.
It's similar. NFTs were collectibles, like baseball cards. Now, every piece of content online can be its own coin.
Yeah, through Base. It's a self-custodial wallet, so you hold your own crypto and don't have to trust any third party, even Coinbase. The main Coinbase app is regulated in each country, but with self-custody, we can launch in 190 countries from day one.
How many countries are fighting crypto? Don't want it?
The biggest is China. It's not technically illegal for Chinese people to own crypto, but the government blocks it with the Great Firewall. They debanked crypto companies and issued their own digital yuan, which is a tool for control. India's Reserve Bank has concerns about capital controls. Some countries clamp down because they want to prevent money from leaving, but the people in those countries desperately want crypto. We try to work with governments while providing tools for freedom.
When it comes to using crypto as a currency, the volatility is a big issue. When do you think it will level off?
Bitcoin has gotten less volatile over the last 10 years as more people own it. As we go from 500 million users to a couple billion, it will get even less volatile, but it'll still go up over time as more people come in. You won't see 100% wild swings, but it's still a new asset class.
Lot of people are using Bitcoin more like a store of value, and then as a currency like a medium of exchange, they're using things like USDcoin or things which are less volatile. So again, crypto is kind of reinventing all these pieces of the financial system and making them more fast, cheap, global, efficient.
What do you think it will go to? Like the long-term implications of it?
Yeah, from a market cap point of view, I think it's got a long way to go, 10 or 100x. But the ultimate outcome is that governments stop controlling currency. We exist in a world with 190 countries and about 150 currencies. Imagine if every country had its own internet, that would be terrible. We should all be running on the same monetary system globally, a fair system that no one country or company controls. The power to issue currency is being unbundled from the state and returned to individuals. It's going to lead to a more fair and free society, money that can't be inflated away, instant transactions for tiny amounts, cross-border. The current financial system is an unfair tax on every transaction.
Um, I'll give you an example. You remember text messaging used to be like 30 cents.
Yeah. And you know I think that at that time there was maybe a billion messages a day sent by text message. But applications like WhatsApp and Signal came out and now it's free to send a message anywhere in the world instantly.
There's now like 200 billion messages sent per day because it's free and instant and global. That's what's going to start to happen with the economy and money. There's so much friction today to move money. If we can bring the cost down to under a cent and under one second anywhere in the world, transactions will flourish. So that's what we're trying to do with crypto, update the financial system, make it more efficient, more global, more fair, more free.
Who — couple of questions just off what you were riveting on there. You know, who set up the USD stable coin?
So, originally there was a company called Circle in partnership with Coinbase and we co-created it. Now they're the issuer and we're a distributor. But basically Circle is the issuer of USDC.
Okay. And then, you know, when we're talking about moving to a digital currency globally and having a global currency, you know, how do you think that would affect the US? I mean, Elon Musk talks about how the US has weaponized the dollar, which is a bad thing.
I mean, slippery slope there, right? You get the reputation, then people are going to want to move. We've seen BRICS — Brazil, Russia, India, China, South Africa, several other countries have joined because the US has weaponized the dollar. So if we move to a global currency, how does that affect the US's ability to have control around the globe?
Yeah. So, this is a great question, it's complicated. If you think about a digital dollar like USDC, that's unequivocally good for the dollar and the US. It helps make the dollar the reserve currency and creates demand for US Treasuries. If we talk about Bitcoin, it's more complicated. If the dollar maintains discipline, it will continue as reserve currency. If the dollar loses discipline, people will flee to Bitcoin. In that case, the US could lose reserve currency status. If they're going to lose it, I'd rather they go to Bitcoin than the Chinese yuan.
Mhm. Right. So that's why I say Bitcoin is kind of like a check and balance on the dollar and deficit spending. I hope the US maintains discipline and remains strong. In that case, crypto will be a very good thing. But if we're going to lose it, I'd rather we have Bitcoin than have to live under a Chinese system.
And then, you know, we're talking about you're fighting congressmen, senators, governments. What about banks? Like Chase, Bank of America, Regions? I imagine they do not want this to happen.
Yeah, these are big organizations. It's funny, some in the bank are positive, some negative. In general, we've had good relationships. We need to work with them because we've built a bridge from the bank system to crypto. When people come to Coinbase, they connect their bank and move money. So we work with most big banks, but some are skeptical and afraid of disruption.
It could eliminate them, correct?
Yeah, if I'm sitting here in 10 or 20 years, I'd be hard. I still think there'll be dollars and banks, but a whole generation is growing up using Coinbase like a bank replacement. There's a community bank lobby story: when we were trying to get stablecoin legislation passed, the community bank lobby lobbied against it because they didn't want stablecoins paying 4.5% interest while they pay near zero. They argued it would dry up loans, but really they were protecting their margins. They got a line in the bill prohibiting stablecoin issuers from paying interest. That passed. But we're not a stablecoin issuer, so we can continue to pay rewards. We pay 4.5% to customers holding USDC. We believe in updating the financial system. If community banks don't like it, they should compete. That's what the free market does. So we have to deal with these special interests. It's part of why I'm in favor of small government.
How long do you think it'll be before we start seeing people use crypto as currency at Walmart, the gas station, the grocery store, everywhere?
Yeah, the earliest adopters will be online e-commerce. We just announced a partnership with Shopify to accept USDC and give 1% cash back because merchants save on credit card fees. Also the Bitcoin credit card and Visa debit card allow people to spend crypto. Eventually we hope merchants do direct integration to save fees. The credit card companies have a strong network effect, but a decentralized protocol like crypto may be the only way to compete.
Do you transact in crypto?
Yeah, I use my Coinbase card for most purchases. I'm trying to live on the frontier. Many customers start with investment and then add loans, payments, earning yield.
Is that through base or through Coinbase?
So I can go on Coinbase and apply for a loan?
Yeah, that's what we ultimately want to do, update the financial system, all parts including borrowing and lending.
What are you checking when somebody borrows? Are you checking credit or just what's in their Coinbase wallet?
Yeah, in that case it's just the collateral of Bitcoin in their wallet. We don't need a credit check. But we'd like to do non-collateralized lending based on credit. We're trying to invent a decentralized credit score based on the blockchain, so you can see a record of transactions and build a reputation score like a FICO on chain.
Wow. So a whole new credit score system.
Yeah, in the US it can be difficult to get a loan. In many emerging markets, there's no credit system. When I was in Argentina, nobody could get a mortgage. Only rich people pay cash. With crypto, we can provide a lending market globally. A 20-year-old in India should be able to get a loan to start a business. Most people don't have access to credit markets.
Interesting.
Let's take a quick break. When we come back, I want to talk about the journey to starting Coinbase.
