Brian Armstrong, CEO of Coinbase Global Inc (NASDAQ:COIN), said on Wednesday that the leading US cryptocurrency exchange cannot support a proposed cryptocurrency regulation bill in its current form, damaging the measure's prospects for consideration in the Senate.

Armstrong told lawmakers and stakeholders that the proposed bill, introduced earlier this week in the Senate, contains "too many problems" and could leave the industry worse off than it is under the current regulatory environment.

The bill aims to create a comprehensive framework for digital assets, clarifying when tokens are securities or commodities and transferring oversight of spot cryptocurrency markets to the Commodity Futures Trading Commission (CFTC). However, Armstrong criticized the provisions, which he said would effectively ban tokenized securities, weaken the role of the CFTC, and "kill rewards on stablecoins," Coinbase's core product.

Without Coinbase's support, it's unclear whether the Senate Banking Committee will be able to advance the legislation. The exchange has been a key voice in shaping US cryptocurrency policy and has donated millions of dollars to political action committees supporting pro-crypto candidates.