Russia Considers Cryptocurrency Trading for Qualified Investors

Organizations listed in the register of exchanges and trading systems may be granted the right to conduct digital currency trading for “particularly qualified” investors, according to a source in the Ministry of Finance, as reported by Interfax.

The agency’s source indicated that the proposal is included in a draft review prepared by the ministry on two bills: one concerning the regulation of cryptocurrency mining and the other on digital currency settlements within the framework of an experimental legal regime (ELR).

According to the review of the second document mentioned, digital currency settlements for participants in foreign economic activity could be permitted under general rather than special regulation. This would require recognizing digital currency as a currency value.

“It is proposed […] to provide […] the possibility of establishing special regulation for conducting organized trading of digital currency, recognized as a commodity, based on an exchange license or a trading system license for a limited circle of ‘particularly qualified’ investors,” states the draft government conclusion.

The document lacks criteria for classifying such investors.

In other words, digital currency settlements are proposed to be allowed for all foreign economic activity participants, while the purchase of assets on Russian exchanges would be limited to a select group of investors within the ELR.

Currently, the Central Bank’s register includes the Moscow Exchange, SPB Exchange, St. Petersburg International Mercantile Exchange (SPIMEX), St. Petersburg Currency Exchange (SPCEX), Eastern Exchange, and the National Commodity Exchange and Exchange “CTS”.

Previously, Anatoly Aksakov, head of the State Duma Committee on Financial Markets, stated that the largest Russian platforms possess the necessary infrastructure to implement the initiative.

Since 2022, the Ministry of Finance has advocated for comprehensive regulation of digital currencies and prepared a bill that proposed the legalization of cryptocurrency exchanges in Russia. In the absence of consensus with the Central Bank, financial authorities decided to move towards creating an ELR. Meanwhile, the Bank of Russia remained opposed to the legalization of cryptocurrency settlements within the country.

In September 2023, Ivan Chebeskov, director of the Ministry of Finance’s Financial Policy Department, stated that he doubted the necessity of testing the use of cryptocurrency in export settlements through the ELR, as “all experiments were conducted in practice” over the past year.

Under current legislation, Russian residents cannot settle in cryptocurrencies. Their circulation is in a “grey zone,” although purchasing on foreign exchanges is not prohibited.

The date for considering both bills (on mining regulation and cryptocurrency settlements for foreign economic activity) in the State Duma has not yet been set. They were included in the June plan but have not been reviewed.

At the end of 2022, Prime Minister Mikhail Mishustin instructed the Ministry of Finance, the Central Bank, Rosfinmonitoring, the Federal Tax Service, and the FSB to develop a mechanism for using cryptocurrencies in international settlements.

That same year, the Moscow Exchange or SPB Exchange were proposed as service centers for conducting international settlements in digital assets. In turn, the government began developing a mechanism for such operations.

It also became known that Russian companies are already conducting cross-border payments using cryptocurrencies. Transactions are reportedly carried out “in limited volumes” for settlements with unfriendly countries.

In July 2024, Deputy Chairman of the Central Bank Alexei Guznov announced plans by Russian authorities to permit the use of stablecoins for international settlements.