The Bank of Russia has formulated requirements for cryptocurrency trading. What you need to know
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- The Bank of Russia has formulated requirements for cryptocurrency trading. What you need to know
The information in this material is not an investment recommendation.
On behalf of the president, the central bank proposed allowing a limited number of Russian investors to buy and sell cryptocurrencies under a special experimental legal regime (EPR) for three years. The Bank of Russia sent the initiative to the Cabinet of Ministers for discussion. However, the Central Bank does not consider cryptocurrency as a means of payment and proposes to ban settlements on transactions with cryptocurrency outside the EPR. What is the future of cryptocurrencies in Russia, Izvestia figured out.
What the Central Bank offers
• The Central Bank, in accordance with the instructions of Russian President Vladimir Putin, has sent proposals to the Cabinet of Ministers on regulating investments in cryptocurrencies. It is proposed to allow some investors from Russia to purchase and sell cryptocurrencies. It is planned to install a special EPR for three years for implementation.
Currently, in Russia, citizens have the right to buy and own cryptocurrency, but it is prohibited to use it for payments within the country. There is no centralized exchange in the Russian Federation. Therefore, digital currency can only be purchased on foreign exchange platforms.
• Transactions with cryptocurrencies within the EPR can only be carried out by highly qualified investors. This is a new status that citizens are expected to be able to receive if their investments in securities and deposits exceed 100 million rubles or if their income over the past year amounted to more than 50 million rubles.
• Companies that are qualified investors under the current legislation can also participate in the experiment. For financial institutions that want to invest in cryptocurrency, the Bank of Russia will establish regulatory requirements, taking into account the level and nature of the risks of such an asset.
• This experiment is aimed at increasing the transparency of the cryptocurrency market, forming standards for the provision of services, and expanding investment opportunities for experienced investors who are willing to take on increased risks.
• It is worth remembering that a private cryptocurrency is not issued or guaranteed by any jurisdiction, is based on mathematical algorithms and is subject to increased volatility. Therefore, when making a decision to invest in cryptocurrencies, investors should be aware that they are taking on the risks of potentially losing their funds.
The issue of cryptocurrencies is a continuous process of generating new cryptocurrencies in one network or another. If in traditional systems the issue of currency is the printing and minting of new banknotes, then the issue of cryptocurrencies is due to mining.
Will there be more easing in the market
• No other exemptions are planned for this experiment. The Central Bank still does not consider cryptocurrency as a means of payment. Therefore, the regulator proposes to simultaneously impose a ban on settlements between residents on transactions with cryptocurrencies outside the EPR, as well as to establish responsibility for violating this ban.
• All qualified investors will be allowed to invest money in derivative financial instruments (FIUs), for example, in currencies and securities, as well as in digital financial assets, even if their profitability is linked to the value of the cryptocurrency. However, they will not be able to earn income in the form of cryptocurrencies.
What is the future of cryptocurrency in Russia
• The decision of the Central Bank will protect the vast majority of investors from risky transactions with cryptocurrency, because it is proposed to introduce a ban on settlements on transactions with cryptocurrency outside the experimental legal regime. In fact, this is a permit for a very limited number of investors — especially qualified ones, whose investments exceed 100 million rubles or whose income last year amounted to more than 50 million rubles.
• The initiative aims to limit the vast majority of investors from high-risk transactions. For more than 90% of them, access to buying and selling cryptocurrencies will be closed. However, investors with large assets will get new investment opportunities. Such investors are usually aware of the risks, and their investments in cryptocurrencies will not be so large as to pose a threat to them personally.
• Such an experiment corresponds to world practice. In developed countries, they understand that cryptocurrencies should be regulated. In parallel with the restrictions, it is necessary to create a regulatory system for those who want to invest in such instruments in order to minimize their risks.
• Russia, like many other countries, is taking cautious steps to explore bitcoin as a strategic asset. However, Finance Minister Anton Siluanov stated in December 2024 that the cryptocurrency was too volatile for the government to form its reserves in bitcoin or another crypt.
When writing the material, Izvestia talked and took into account the opinions of:
- financier Alexander Losev;
- Maxim Chirkov, Associate Professor of the Department of Economic Policy and Economic Measurements at GUU;
- Mikhail Uspensky, Managing Director of Parallax consulting Agency;
- Vitaly Kitaychuk, Head of the financial technology company Only Bank;
- Denis Astafyev, founder of the SharesPro investment company.
Переведено сервисом «Яндекс Переводчик»
