Senator Lummis says Kraken’s master account opens door for Bitcoin adoption in banks

Kraken’s newly granted access to a Fed master account brings Bitcoin closer to mainstream banking, said Senator Cynthia Lummis, a known Bitcoin proponent, in a Wednesday interview with CNBC.

The senator predicted that the development would accelerate convergence between traditional banks and crypto firms, enabling financial institutions to eventually offer both dollar-based and digital asset services under one roof.

“The Fed finally recognized the importance of this asset embedded in the US and can now use safety and soundness standards apply them to digital asset financial institutions like Kraken and have partial access to the Fed, which allows them to begin integrating the US dollar with digital assets,” Lummis said.

Kraken utilized Wyoming’s special-purpose depository institution framework to secure approval, becoming the first digital asset firm to gain access to the Fed’s rails.

“In the future, you’re going to see banks buying digital asset companies, digital asset companies buying banks. So if you go into a bank, they can serve you both in fiat currencies like the US dollar and digital assets like Bitcoin,” she added. “It’s going to create the 21st-century financial services industry.”

Discussing the tax reform she introduced last July, Lummis said lawmakers are weighing a $300 threshold to exempt small crypto transactions from capital gains taxes.

The proposed de minimis exemption would allow Americans to spend Bitcoin and other digital assets on everyday purchases without triggering a taxable event, according to the Wyoming Republican who chairs the Senate Banking Subcommittee on Digital Assets.

The proposed de minimis exemption would allow Americans to spend Bitcoin and other digital assets on everyday purchases without triggering a taxable event, Lummis said today in a televised interview.

“The challenge is trying to figure out how you can use Bitcoin as a means of exchange without paying a capital gains tax on it,” Lummis said.

On the push for regulatory clarity, she said Republicans on the Banking Committee have made significant concessions to Democratic colleagues on legislation that would establish clearer rules for digital assets.

The House has already approved a version of the legislation, but Senate negotiations remain ongoing.

“We’ve given over 90 of the requests that the Democrats had of us to them, and yet we can’t get them to yes,” Lummis said.