Block whose: authorities will limit investments in "unfriendly" cryptocurrencies
The authorities are preparing additional restrictions on the purchase of cryptocurrencies. In general, unqualified investors will be able to invest up to 300 thousand rubles in the top 5 largest digital currencies. However, this list includes the USDT and USDC dollar stablecoins — their issuers operate in the Western legal system, which means that there is still a risk of freezing for our users, as well as the BNB coin associated with the Binance exchange, which previously limited services to Russians. Commissions, limits and other mechanisms may be introduced for trading these coins to protect customers, Deputy Finance Minister Ivan Chebeskov told Izvestia. The State Duma expects to adopt the bill in June, and it may enter into force before the end of the year.
What restrictions are the authorities preparing for investments in the crypt?
Unqualified investors in Russia will be allowed to buy the five largest cryptocurrencies by capitalization, Anatoly Aksakov, head of the State Duma Committee on the financial market, told Izvestia. Currently, this list includes Bitcoin, Ethereum, USDT, BNB and USDC, according to TradingView data.
However, three of these assets are considered potentially risky for Russian users. Therefore, the authorities are preparing separate rules for the purchase of these coins.
The issue of admission to trading of individual assets, including USDT and BNB, was one of the key issues in the preparation of the bill on the regulation of the crypto market for the second reading in the State Duma, Deputy Finance Minister Ivan Chebeskov told Izvestia. According to him, trading in these coins carries increased risks for Russians, so the authorities plan to introduce additional investor protection mechanisms.
"These can be both means of technical protection and various economic incentives, such as commissions or recommendations that would encourage citizens to own other assets," Ivan Chebeskov explained to Izvestia.
During the preparation of the document, various options were considered, up to a complete ban on trading in such coins, the deputy minister said. However, a significant part of the market participants supported maintaining access to them in the presence of special protection mechanisms. The main problem with stablecoins is that their issuers are able to block users' assets, Ivan Chebeskov added.
A stablecoin is a cryptocurrency whose price is pegged to a regular currency, most often the dollar. Therefore, its course is usually much more stable.
According to Ivan Chebeskov, the bill is almost ready for the second reading. Anatoly Aksakov told Izvestia that the document is scheduled to be adopted in June, and it should enter into force by the end of the year. However, some items will require a transition period for preparation, the deputy added.
The amount of additional commissions for trading "unfriendly" cryptocurrencies has not yet been disclosed, but a logical range can be considered 0.5–2% of the transaction amount, and for dollar—denominated stablecoins - up to 3%, according to Freedom Global analyst Vladimir Chernov. According to him, too high fees will only push investors back to the gray market.
In addition to fees, technical restrictions may also be used. Mandatory testing of investors, annual limits on the volume of transactions, a cooling-off period before withdrawing funds, and restrictions on transferring assets to external wallets are possible, says Denis Astafyev, entrepreneur and founder of the SharesPro fintech platform.
Which cryptocurrencies are considered the most risky
Individual cryptocurrencies technically imply the possibility of blocking, said Dmitry Lesnov, Deputy General Director for brokerage business at Finam.
First of all, we are talking about the dollar stablecoins USDT and USDC, said Vladimir Chernov. Their issuers operate in the Western legal system, so Russian users remain at risk of being frozen or denied service.
Moreover, in the case of USDT, the risk is no longer theoretical, the expert emphasized. The coin's issuer reported freezing $344 million at the request of the American authorities and cooperating with 340 law enforcement agencies in 65 countries. Circle, the company that issues USDC, also reserves the right to block individual addresses, as well as freeze coins if they are suspected of illegal activity or at the request of government agencies.
Tokens from foreign platforms remain another risk group. First of all, this is the BNB of Binance, the largest crypto exchange, which has already imposed restrictions against Russian clients, Vladimir Chernov recalled. Similar risks exist for the OKB coin from OKX, as well as the CRO crypt from Crypto.com .
Since Russian crypto exchanges will centrally purchase digital assets for subsequent trading, all transactions with such coins can be tracked by their issuers, said Dmitry Lesnov, Deputy General Director for brokerage at Finam.
He explained: most blockchains are an open registry, so experts can track the history of specific coins and establish through which platforms they were purchased. If an issuer or a foreign company decides to restrict work with Russian users, such coins may be at risk of being blocked or frozen.
Anonymous cryptocurrencies, such as Monero, may also fall into the category of potentially problematic assets, Denis Astafyev believes. Such coins make it difficult to track transactions, which creates additional legal and tax risks. At the same time, Andrei Loboda, a member of the RASO and the commission on mining and blockchain technology of the CCI of the Russian Federation, noted that Monero remains in demand among Russian users, although Bitcoin is still the most popular asset, for which there are practically no such risks.
In any case, the final list of available cryptocurrencies will differ from one trading organizer to another, said Sergey Shvetsov, chairman of the Moscow Exchange's Supervisory Board. It is assumed that the Bank of Russia will determine a list of cryptocurrencies for unqualified investors, and for qualified exchange participants they will be able to create their own lists. At the same time, the sites themselves will not be required to provide access to all permitted assets.
How will the crypto market change after the adoption of the law
Currently, the majority of Russians purchase cryptocurrencies through foreign exchanges, exchange services, Telegram channels and other informal mechanisms, said Vladimir Chernov. Another way is to conduct a transaction directly between token holders (P2P). Because of this, the market actually exists in a semi-legal status.
After the launch of the new regulation, digital assets can be purchased through Russian exchanges, brokers and trust managers, Denis Astafyev added. There will also be special infrastructure requirements for storing and exchanging cryptocurrencies.
Unqualified investors will be able to purchase only a limited list of the most liquid assets, having passed mandatory testing and observing the limit of 300 thousand rubles, Vladimir Chernov added. "Quals" will have much wider access and will not be limited in the amount of investments. At the same time, it will still be prohibited to use cryptocurrency as a means of paying for goods and services within Russia.
Such a model should integrate cryptocurrencies into the legal financial system and at the same time limit the risks for the mass investor, Denis Astafyev said.
At the same time, the new system is able to change the balance of power between market participants. Initially, support for domestic crypto exchanges was discussed, but later the Moscow Exchange, which has the largest customer base, also showed interest in organizing trades.
Russian industrial mining can play an important role for the future market, according to Andrey Loboda from the CCI. If more than 20 thousand tons are mined annually within the country. This will provide liquidity without the need to massively buy cryptocurrencies in foreign jurisdictions, and the origin of assets will be transparent.
Despite the legalization of trading, cryptocurrencies will still remain a non-standard financial instrument for the Russian market, concluded Vladimir Chernov. The Central Bank continues to consider them highly risky due to high volatility and sanctions threats. That is why limits, testing and additional restrictions on individual coins are provided for non-quarters in order to avoid uncontrolled growth of investments.
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