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Coinbase’s latest run places Brian Armstrong among the great leaders of Silicon Valley

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Brian Armstrong lacks the swagger of Jeff Bezos, the audacity of Mark Zuckerberg, or Elon Musk’s cult of personality. Still, it’s become clear of late that the Coinbase CEO possesses the same vision and leadership qualities that have made those other founders tech industry legends. The time has come to give the 42-year-old Armstrong his due.

I recently sat down with the Coinbase CEO at a Goldman Sachs event north of San Francisco. Unlike many executives, Armstrong doesn’t relish media interviews, but he lights up when given the opportunity to discuss big ideas in crypto and technology. This was the case when I asked him about the fast-evolving world of wallets—which Armstrong believes will supplant web browsers—and the potential for crypto-based identity verification, which he thinks is coming soon.

Armstrong has been right about calls like this in the past. Way back in 2016, he shared a “master plan” that envisioned blockchain evolving into a multi-pronged industry that touched hundreds of millions of people. It seemed fanciful at the time, and even more so when Crypto Winter set in and Bitcoin nose-dived to $2,000 the next year. Today, that far-flung prediction has come true. This ability of Armstrong to see where crypto is going, and to position his company accordingly, is a big reason why Coinbase has been the dominant company in U.S. crypto for nearly 15 years.

This is reflected in Coinbase’s third-quarter earnings report, released on Thursday, which shows how the company has diversified beyond trading revenue, and is making real money on services like stablecoins, staking, and custody. Equally impressive is that Coinbase keeps posting hefty profits quarter after quarter.

A big reason for this is that Armstrong, like other successful CEOs, figured out how to put in place a skilled executive team. Unlike Coinbase’s early days, which were riven by drama and in-fighting, the company is today defined by stability. That’s thanks in big part to the steady hand of CFO Alesia Haas, and to President and COO Emilie Choi, whose prowess at M&A has made Coinbase an essential player in every sector of crypto. The company’s recent acquisition of derivative shop Deribit, and its perpetual futures cash machine, is looking especially shrewd.

Like other visionary CEOs, Armstrong has been willing to embrace unpopular and contrarian stances. Those include rejecting the “blockchain not Bitcoin” vogue during the crypto winter of 2015, and telling the New York Times to take a hike when the paper branded Coinbase as racist for refusing to bow to the excesses of wokeness.

Armstrong has also made some outsize mistakes. In 2022, he squandered resources on a series of Hollywood vanity projects at a time when he should have been preparing Coinbase to ride out an industry downturn. More recently, a disastrous decision to outsource service operations to India led to a costly hack. But even the best CEOs don’t bat a thousand—ask Zuckerberg about the metaverse or Musk about the Tesla 3 roll-out. And like those leaders, Armstrong has shown he’s able to learn from his mistakes.

In the coming year, his CEO skills will be tested anew. Coinbase’s most formidable overseas rivals, Binance and Tether, are getting set to ramp up U.S. operations, and the company will have to show it can avoid the bureaucracy and corporate bloat that befalls many incumbents. But based on history, it would be foolish to underestimate Armstrong.

Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts

DECENTRALIZED NEWS

Mastercard eyes a stablecoin startup: Earlier this month, the credit card giant lost out to Coinbase in its bid to acquire stablecoin startup BVNK. Now, it’s pursuing another  stablecoin company: Chicago-based Zerohash. The potential price—between $1.5 and $2 billion—suggests an element of FOMO. (Fortune

JPM hearts blockchain: America’s biggest bank has put a private equity fund on its in-house Kinexys Fund Flow chain. The offering is available only to wealthy clients, but appears to be part of a broader tokenization push aimed at leveraging blockchain’s intrinsic speed and transparency in order to sell exotic assets to retail. (WSJ)

Fight fight fight: That’s the name of the corporate vehicle that oversees President Trump’s memecoin. It is now in talks to acquire Republic, a blockchain-based crowd-funding platform, with a view to making $TRUMP part of its operations for fees and capital-raising. (Bloomberg)

CZ vs. Liz Warren: The Binance founder threatened to file a defamation suit over comments by the Democratic senator that he “pleaded guilty to a criminal money laundering charge.” Warren’s camp shot back that he has no case because the statement is true and, in any event, is not actionable. (The Block)

Crypto ETFs Part II: Recent approvals by the SEC mean investors can now buy Solana, Litecoin and Hedera in an ETF wrapper. The Bitwise Solana Staking ETF (BSOL) notched around $50 million in daily trading volume but the other two flopped. (Fortune)

MAIN CHARACTER OF THE WEEK

Blockworks cofounder Jason Yanowitz defends decision to close newsroom.

@JasonYanowitz

Blockworks CEO Jason Yanowitz, or Yano, became this week’s main character when he unceremoniously shut the firm’s well-regarded newsroom. Media is a notoriously tough business but Yano’s new plan to remake Blockworks as a data analytics firm is no slam dunk. That’s doubly the case for a CEO who is known for prowess in marketing, not technology.

MEME O’ THE MOMENT

A screenshot of a Twitter post making fun of Coinbase CEO's decision to sway prediction markets.
Is market manipulation funny?

@Crypto_McKenna

Brian Armstrong set off chatter on Crypto Twitter when he used the end of Coinbase’s earnings call to utter a series of words that appeared in “will he say it?” bets on prediction markets. Some fretted about the ethical implications, but others, seeing the absurdity in the whole thing, just found it funny.

This is the web version of Fortune Crypto, a newsletter that breaks down the stories, trends, and coins that are shaping the future and business of crypto. Sign up to get it delivered free to your inbox.



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Hollywood writers say Warner takeover ‘must be blocked’

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Hollywood writers, producers, directors and theater owners voiced skepticism over Netflix Inc.’s proposed $82.7 billion takeover of Warner Bros. Discovery Inc.’s studio and streaming businesses, saying it threatens to undermine their interests.

The Writers Guild of America, which announced in October it would oppose any sale of Warner Bros., reiterated that view on Friday, saying the purchase by Netflix “must be blocked.”

“The world’s largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent,” the guild said in an emailed statement. “The outcome would eliminate jobs, push down wages, worsen conditions for all entertainment workers, raise prices for consumers, and reduce the volume and diversity of content for all viewers.”

The worries raised by the movie and TV industry’s biggest trade groups come against the backdrop of falling movie and TV production, slack ticket sales and steep job cuts in Hollywood. Another legacy studio, Paramount, was sold earlier this year.

Warner Bros. accounts for about a fourth of North American ticket sales — roughly $2 billion — and is being acquired by a company that has long shunned theatrical releases for its feature films. As part of the deal, Netflix co-CEO Ted Sarandos has promised Warner Bros. will continue to release moves in theaters.

“The proposed acquisition of Warner Bros. by Netflix poses an unprecedented threat to the global exhibition business,” Michael O’Leary, chief executive officer of the theatrical trade group Cinema United, said in en emailed statement Friday. “The negative impact of this acquisition will impact theaters from the biggest circuits to one-screen independents.”

The buyout of Warner Bros. by Netflix “would be a disaster,” James Cameron, the director of some of Hollywood’s highest-grossing films in history including Titanic and Avatar, said in late November on The Town, an industry-focused podcast. “Sorry Ted, but jeez. Sarandos has gone on record saying theatrical films are dead.”

On a conference call with investors Friday, Sarandos said that his company’s resistance to releasing films in cinemas was mostly tied to “the long exclusive windows, which we don’t really think are that consumer friendly.”

The company said Friday it would “maintain Warner Bros.’ current operations and build on its strengths, including theatrical releases for films.”

On the call, Sarandos reiterated that view, saying that, “right now, you should count on everything that is planned on going to the theater through Warner Bros. will continue to go to the theaters through Warner Bros.” 

Competition from online outfits like YouTube and Netflix has forced a reckoning in Hollywood, opening the door for takeovers like the Warner Bros. deal announced Friday. Media giants including Comcast Corp., parent of NBCUniversal, are unloading cable-TV networks like MS Now and USA, and steering resources into streaming. 

In an emailed note to Warner Bros. employees on Friday, Chief Executive Officer David Zaslav said the board’s decision to sell the company “reflects the realities of an industry undergoing generational change in how stories are financed, produced, distributed, and discovered.”

The Producers Guild of America said Friday its members are “rightfully concerned about Netflix’s intended acquisition of one of our industry’s most storied and meaningful studios,” while a spokesperson for the Directors Guild of America raised concerns about future pay at Warner Bros.

“We will be meeting with Netflix to outline our concerns and better understand their vision for the future of the company,” the Directors Guild said.

In September, the DGA appointed director Christopher Nolan as its president. Nolan has previously criticized Netflix’s model of releasing films exclusively online, or simultaneously in a small number of cinemas, and has said he won’t make movies for the company.

The Screen Actors Guild said Friday that the transaction “raises many serious questions about its impact on the future of the entertainment industry, and especially the human creative talent whose livelihoods and careers depend on it.”

Oscar winner Jane Fonda spoke out on Thursday before the deal was announced. 

“Consolidation at this scale would be catastrophic for an industry built on free expression, for the creative workers who power it, and for consumers who depend on a free, independent media ecosystem to understand the world,” the star of the Netflix series Grace and Frankie wrote on the Ankler industry news website.

Netflix and Warner Bros. obviously don’t see it that way. In his statement to employees, Zaslav said “the proposed combination of Warner Bros. and Netflix reflects complementary strengths, more choice and value for consumers, a stronger entertainment industry, increased opportunity for creative talent, and long-term value creation for shareholders.”



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4 times in 7 seconds: Trump calls Somali immigrants ‘garbage’

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He said it four times in seven seconds: Somali immigrants in the United States are “garbage.”

It was no mistake. In fact, President Donald Trump’s rhetorical attacks on immigrants have been building since he said Mexico was sending “rapists” across the border during his presidential campaign announcement a decade ago. He’s also echoed rhetoric once used by Adolf Hitler and called the 54 nations of Africa “s—-hole countries.” But with one flourish closing a two-hour Cabinet meeting Tuesday, Trump amped up his anti-immigrant rhetoric even further and ditched any claim that his administration was only seeking to remove people in the U.S. illegally.

“We don’t want ‘em in our country,” Trump said five times of the nation’s 260,000 people of Somali descent. “Let ’em go back to where they came from and fix it.” The assembled Cabinet members cheered and applauded. Vice President JD Vance could be seen pumping a fist. Defense Secretary Pete Hegseth, sitting to the president’s immediate left, told Trump on-camera, “Well said.”

The two-minute finale offered a riveting display in a nation that prides itself as being founded and enriched by immigrants, alongside an ugly history of enslaving millions of them and limiting who can come in. Trump’s U.S. Immigration and Customs Enforcement raids and deportations have reignited an age-old debate — and widened the nation’s divisions — over who can be an American, with Trump telling tens of thousands of American citizens, among others, that he doesn’t want them by virtue of their family origin.

“What he has done is brought this type of language more into the everyday conversation, more into the main,” said Carl Bon Tempo, a State University of New York at Albany history professor. “He’s, in a way, legitimated this type of language that, for many Americans for a long time, was seen as outside the bounds.”

A question that cuts to the core of American identity

Some Americans have long felt that people from certain parts of the world can never really blend in. That outsider-averse sentiment has manifested during difficult periods, such as anti-Chinese fear-mongering in the late 19th century and the imprisonment of some 120,000 Japanese Americans during World War II.

Trump, reelected with more than 77 million votes last year, has launched a whole-of-government drive to limit immigration. His order to end birthright citizenship — declaring that children born to parents who are in the United States illegally or temporarily are not American citizens despite the 14th Amendment — is being considered by the Supreme Court. He has largely frozen the country’s asylum system and drastically reduced the number of refugees it is allowed to admit. And his administration this week halted immigration applications for migrants from 19 travel-ban nations.

Immigration remains a signature issue for Trump, and he has slightly higher marks on it than on his overall job approval. According to a November AP-NORC poll, roughly 4 in 10 adults — 42% — approved of how the president is handling the issue, down from about half who approved in March. And Trump has pushed his agenda with near-daily crackdowns. On Wednesday, federal agents launched an immigration sweep in New Orleans,

There are some clues that Trump uses stronger anti-immigration rhetoric than many members of his own party. A study of 200,000 speeches in Congress and 5,000 presidential communications related to immigration between 1880 and 2020 found that the “most influential” words on the subject were terms like “enforce,” “terrorism” and “policy” from 1973 through Trump’s first presidential term.

The authors wrote in the Proceedings of the National Academy of Sciences that Trump is “the first president in modern American history to express sentiment toward immigration that is more negative than the average member of his own party.” And that was before he called thousands of Somalis in the U.S. “garbage.”

The U.S. president, embattled over other developments during the Cabinet meeting and discussions between Russian President Vladimir Putin and U.S. envoys, opted for harsh talk in his jam-packed closing.

Somali Americans, he said, “come from hell” and “contribute nothing.” They do “nothing but bitch” and “their country stinks.” Then Trump turned to a familiar target. Rep. Ilhan Omar, D-Minn., an outspoken and frequent Trump critic, “is garbage,” he said. “Her friends are garbage.”

His remarks on Somalia drew shock and condemnation from Minneapolis to Mogadishu.

“My view of the U.S. and living there has changed dramatically. I never thought a president, especially in his second term, would speak so harshly,” Ibrahim Hassan Hajji, a resident of Somalia’s capital city, told The Associated Press. “Because of this, I have no plans to travel to the U.S.”

Omar called Trump’s “obsession” with her and Somali-Americans “creepy and unhealthy.”

“We are not, and I am not, someone to be intimidated,” she said, “and we are not gonna be scapegoated.”

Trump’s influence on these issues is potent

But from the highest pulpit in the world’s biggest economy, Trump has had an undeniable influence on how people regard immigrants.

“Trump specializes in pushing the boundaries of what others have done before,” said César Cuauhtémoc García Hernández, a civil rights law professor at Ohio State University. “He is far from the first politician to embrace race-baiting xenophobia. But as president of the United States, he has more impact than most.” Domestically, Trump has “remarkable loyalty” among Republicans, he added. “Internationally, he embodies an aspiration for like-minded politicians and intellectuals.”

In Britain, attitudes toward migrants have hardened in the decade since Brexit, a vote driven in part by hostility toward immigrants from Eastern Europe. Nigel Farage, leader of the hard-right Reform U.K. party, has called unauthorized migration an “invasion” and warned of looming civil disorder.

France’s Marine Le Pen and her father built their political empire on anti-immigrant language decades before Trump entered politics. But the National Rally party has softened its rhetoric to win broader support. Le Pen often casts the issue as an administrative or policy matter.

In fact, what Trump said about people from Somalia would likely be illegal in France if uttered by anyone other than a head of state, because public insults based on a group’s national origin, ethnicity, race or religion are illegal under the country’s hate speech laws. But French law grants heads of state immunity.

One lawyer expressed concerns that Trump’s words will encourage other heads of state to use similar hate speech targeting people as groups.

“Comments saying that a population stinks — coming from a foreign head of state, a top world military and economic power — that’s never happened before,” said Paris lawyer Arié Alimi, who has worked on hate speech cases. “So here we are really crossing a very, very, very important threshold in terms of expressing racist … comments.”

But the “America first” president said he isn’t worried about others think of his increasingly polarizing rhetoric on immigration.

“I hear somebody say, ‘Oh, that’s not politically correct,’” Trump said, winding up his summation Tuesday. “I don’t care. I don’t want them.”

___

Contributing to this report are Associated Press writers Will Weissert and Linley Sanders in Washington, John Leicester in Paris, Jill Lawless in London, Evelyne Musambi in Nairobi, Kenya, and Omar Faruk in Mogadishu.



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Nearly three-quarters of Trump voters think the cost of living is bad or the worst ever

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President Donald Trump and his administration insist that costs are coming down, but voters are skeptical, including those who put him back in the White House.

Despite Republicans getting hammered on affordability in off-year elections last month, Trump continues to downplay the issue, contrasting with his message while campaigning last year.

“The word affordability is a con job by the Democrats,” Trump said during a Cabinet meeting on Tuesday. “The word affordability is a Democrat scam.”

But a new Politico poll found that 37% of Americans who voted for him in 2024 believe the cost of living is the worst they can ever remember, and 34% say it’s bad but can think of other times when it was worse.

The White House has said Trump inherited an inflationary economy from President Joe Biden and point to certain essentials that have come down since Trump began his second term, such as gasoline prices.

The poll shows that 57% of Trump voters say Biden still bears full or almost full responsibility for today’s economy. But 25% blame Trump completely or almost completely.

That’s as the annual rate of consumer inflation has steadily picked up since Trump launched his global trade war in April, and grocery prices have gained 1.4% between January and September.

Meanwhile, Vice President JD Vance pleaded for “patience” on the economy last month as Americans want to see prices decline, not just grow at a slower pace.

Even a marginal erosion in Trump’s electoral coalition could tip the scales in next year’s midterm elections, when the president will not be on the ballot to draw supporters.

A soft spot could be Republicans who don’t identify as “MAGA.” Among those particular voters, 29% said Trump has had a chance to change things in the economy but hasn’t taken it versus 11% of MAGA voters who said that.

Across all voters, 45% named groceries as the most challenging things to afford, followed by housing (38%) and health care (34%), according to the Politico poll.

The poll comes as wealthier households are having trouble affording basics, while discount retailers like Walmart and even Dollar Tree are seeing more higher-income customers.

And in a viral Substack post last month, Michael Green, chief strategist and portfolio manager for Simplify Asset Management, argued that the real poverty line should be around $140,000.

“If the crisis threshold—the floor below which families cannot function—is honestly updated to current spending patterns, it lands at $140,000,” he wrote. “What does that tell you about the $31,200 line we still use? It tells you we are measuring starvation.”



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