Bank Of Russia Proposes Allowing Select Investors To Trade Cryptocurrencies

Russia’s central bank has proposed allowing a limited group of Russian investors to buy and sell crypto assets like Bitcoin (BTC) under a new experimental legal regime.

The apex bank seeks to establish standards for crypto-related services, boost market transparency, and expand investment opportunities for high-net-worth investors.

3-Year Experimental Regime For Crypto Investment In Russia

On March 12, the Bank of Russia proposed allowing a “limited circle of Russian investors” to trade cryptocurrencies. The bank emphasized that the proposal is based on a directive from Russia’s president Vladimir Putin.

“In accordance with the instructions of the President of Russia, the Bank of Russia has sent proposals to the government for discussion on regulating investments in cryptocurrencies,” the announcement stated.

A statement by the central bank says the plan would introduce an experimental legal regime lasting three years in which qualified investors would be allowed to conduct crypto transactions. Investors who wish to participate in the experimental framework must have over 100 million rubles ($1.14 million) in investments or an annual income of over 50 million rubles ($570,000). Notably, eligibility also extends to institutions that have already satisfied existing qualification standards under the current framework.

The Bank of Russia’s rationale for introducing the new crypto program for select investors came from efforts to establish standards for crypto-related services and increase market transparency while expanding investment opportunities for “experienced investors willing to assume higher risks.”

Bank Of Russia Maintains Ban On Retail Crypto Payments

The Bank of Russia reiterated its warnings about the inherent volatility and risks of investing in cryptocurrencies, stressing that any jurisdiction does not guarantee these assets. 

“Therefore, investors, when deciding to invest in cryptocurrency, should be aware that they are taking on the risks of potential loss of their funds,” the bank added.

Despite the proposal, the Bank of Russia noted that cryptocurrency transactions between residents outside the experimental legal regime are banned. The bank suggested enforcing penalties for violations of the experimental regime.

Nonetheless, the move marks Russia’s latest foray into the crypto space. Last year, the country’s lower house of the Federal Assembly, known as the State Duma, passed two bills legalizing cryptocurrency mining and enforcing another experimental regime on cross-border settlements and foreign trading in crypto.