Senator Lummis Urges Banks to Embrace Stablecoins and Digital Assets

Senator Cynthia Lummis urges US banks to adopt stablecoins and digital assets, citing efficiency gains, new revenue streams, and strategic advantages.

U.S. Senator Cynthia Lummis urged banks to embrace stablecoins and digital assets during a Thursday interview. She contended that resistance inhibits innovation and customer choice. Accordingly, she said digital assets provide banks with completely new financial products.

Lummis Highlights Growth Opportunities for Traditional Banks

Lummis wondered why banks keep resisting the adoption of digital assets. She said stablecoins and custody services increase product offerings for customers. Moreover, she stressed that these tools are in line with the changing expectations of consumers.

She revealed that digital asset custody is a natural extension of banking services. Stablecoins, she added, could serve as an efficient means of payment. Therefore, banks were able to modernize operations without losing existing frameworks.

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According to Lummis, stablecoins are used to reduce the payment settlement times. They also reduce transaction costs for domestic and international transfers. As a result, the operational efficiency could improve significantly for financial institutions.

The senator also outlined new revenue sources for banks. Services such as custody, staking and digital payments are in high demand. As a result, banks were able to diversify incomes over traditional lending models.

Lummis went on to say that stablecoins are of strategic importance. In times of dollar weakness, she said, these assets help keep things competitive. Thus, the banks should see digital assets as tools and not threats.

She added that safeguards are already being developed. These measures are to ensure seamless and secure integration. Therefore, she thinks that consumer protection and innovation can coexist.

Legislative Deadlock Slows Stablecoin Adoption Efforts

Lummis’s comments come as major crypto legislation is delayed. Bills such as CLARITY Act, Crypto Market Structure Act are still stuck. These laws are an attempt to create a clear regulatory framework.

Banking groups have actively opposed a number of provisions. Their primary concern is with the interest-bearing stablecoins. They contend that such products have the potential of causing deposit flight from traditional accounts.

Community banks continue to be very concerned. They are fearful that they will lose deposits to digital platforms with yield. As a result, lobbying efforts became strong against the proposed legislation.

A White House meeting on February 2nd, 2026, could not fix disagreements. Bank representatives and crypto firms were not able to reach an agreement on yield provisions. As a result, negotiations became a temporary stalemate.

The most recent Senate Banking Committee draft is banking-oriented. It provides for banning yield, in effect banning yield on stablecoin deposits. Banking associations are very supportive of this approach.

However, these provisions backfired with the industry. Major crypto firms such as Coinbase pulled their legislative support. This move pushed back the delays of more broad-based market structure reforms.

Despite setbacks, the Senate Majority Leader, John Thune, signaled progress. He promised to put debate time on the calendar later in the spring of 2026. Therefore, talks on stablecoin regulation could soon resume.

Stablecoins are the most controversial point of negotiation. Their role in payments, saving and trading continues growing. Meanwhile, policymakers reconcile innovation and financial stability concerns.

Lummis says postponing adoption is bad for competitiveness. She thinks that the banks run the risk of falling behind their counterparts worldwide. Accordingly, she keeps promoting cooperation over resistance.

She concluded that digital assets are the future of financial services. Proper regulation, she said, can open up benefits safely. Therefore, banks that are innovative may benefit in the long run.

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