Russian Bank Authorizes Cryptocurrency Investments for Eligible Financial Backers
In a significant development, Russia's Central Bank has given the green light for traded financial instruments based on cryptocurrency prices among qualified investors. However, these instruments are non-deliverable, meaning investors will not physically hold the digital assets, instead receiving payouts dependent on price fluctuations.
In a press release on May 28, the central bank announced that Russian financial institutions can now issue financial derivatives, digital financial assets (DFAs), and other securities linked to cryptocurrencies. However, access to these offerings is restricted to investors meeting specific legal criteria, with the general public excluded.
Financial regulators have adopted a conservative risk approach, requiring credit institutions to fully back these positions with capital and implement individual exposure limits. These measures aim to minimize the impact of crypto price fluctuations and prevent broader financial risks. The regulations will be formalized within the year.
Despite this development, the Bank of Russia plans to maintain its broader opposition to cryptocurrencies, advising against direct investments. This move follows efforts to create a legal framework for digital assets in Russia, with the government currently reviewing proposals for a pilot program restricting crypto transactions to select investor categories.
In a related move, Russia is also working towards establishing a government-run crypto exchange. Initially introduced in March, the exchange could launch in the coming months and is expected to support the legalization of crypto usage and bring digital transactions under regulatory oversight. The platform will operate within the country's experimental legal framework for financial innovation and will be accessible only to a limited group of approved investors conducting regulated crypto transactions.
Meanwhile, Russia continues to use cryptocurrencies in oil trade with India and China, as domestic businesses utilize digital assets to circumvent economic sanctions imposed after Moscow's invasion of Ukraine.
Enrichment Data:
- Russia’s regulatory approach to cryptocurrencies has evolved significantly in 2025, with several key updates and initiatives shaping the domestic crypto landscape.
- The Russian Ministry of Justice has drafted a bill to legally classify cryptocurrencies as property, enabling authorities to seize and confiscate digital assets in criminal cases, providing a clear legal basis for enforcement.
- Regulations governing cryptocurrency mining and circulation are already in effect as of early 2025.
The development marks a significant step forward in the evolving strategic relationship between cryptocurrencies and Russia’s financial system, with a continued emphasis on risk management, investor protection, and compliance with international sanctions.
Financial institutions in Russia can now issue digital financial assets (DFAs) and other securities linked to cryptocurrencies due to the Central Bank's recent announcement. However, access to these offerings is limited to qualified investors who meet specific legal criteria, as the regulations aim to protect investors from crypto price fluctuations and potential broader financial risks. Meanwhile, the Bank of Russia maintains its opposition to direct cryptocurrency investments and is working towards establishing a government-run crypto exchange to bring digital transactions under regulatory oversight. This move is part of Russia's broader efforts to create a legal framework for digital assets, including the classification of cryptocurrencies as property and regulations for cryptocurrency mining and circulation. In addition, Russia continues to use cryptocurrencies in oil trade with India and China, with domestic businesses utilizing digital assets to bypass economic sanctions.
