Coinbase CEO Brian Armstrong called for an overhaul of U.S. accredited investor laws, arguing the rules lock ordinary Americans out of the market’s biggest gains. He said companies now stay private far longer, leaving retail investors to buy in only after the upside is gone.
Key Takeaways:
Coinbase’s Brian Armstrong urged revisiting U.S. accredited investor rules that require $200,000 income or $1 million net worth. He proposed a financial literacy test, echoing a 2025 U.S. House bill on examination-based accreditation. Wider access would expand Coinbase’s addressable market for tokenized and onchain products.In a post on X, Armstrong said it was “time to revisit the accredited investor laws in the US,” noting that the decades-old framework is a barrier that shields the wealthy at the expense of everyone else. The Coinbase co-founder argued that the current system effectively reserves early-stage returns for people who are already rich, adding:
“Companies are staying private longer, where only accredited investors (aka rich people!) can invest. Retail investors can only come in after IPO, when much of the upside has already been captured.”
A Financial Literacy Test Instead of a Wealth TestArmstrong proposed replacing the wealth-based standard with a merit-based one, suggesting a financial literacy test that, if passed, would qualify someone for accreditation based on competency rather than bank balance or income. Alternatively, he floated scrapping the rule entirely while keeping disclosure requirements and fraud enforcement in place to punish bad actors.
A Familiar Push From CoinbaseCritics, however, counter that the thresholds exist to shield inexperienced investors from illiquid, high-risk and sometimes fraudulent offerings. Private markets carry far less disclosure than public ones, and consumer advocates warn that opening the floodgates could expose retail buyers to losses they cannot absorb.
Armstrong’s view in all of this is one that tries to address that concern by pairing wider access with continued fraud enforcement, though whether that balance satisfies regulators remains to be seen.
On the other hand, supporters of reform argue the status quo is itself a risk, pushing retail investors toward only the most speculative public-market assets while the steadier compounding of early private growth stays off-limits. They contend a knowledge-based test would expand access without abandoning consumer protection.
