The Bank of Russia has eased its opposition to cryptocurrency, at least in public statements. In the past, the regulator has strongly opposed digital assets, citing risks and lack of jurisdictional oversight. However, recent remarks suggest a shift, likely influenced by President Vladimir Putin’s differing stance. This change is limited in scope.

The central bank announced today (Wednesday) that it has submitted cryptocurrency regulation proposals to the government. The move follows a directive from the president. The proposals include an experimental legal regime (ELR) that would allow certain investors to buy and sell cryptocurrencies. The regime would last for three years.

Restricted Access to Investors

The Bank of Russia intends to allow only "highly qualified" investors to participate. This status will be granted to individuals with more than 100 million rubles in securities and deposits or an annual income exceeding 50 million rubles. Companies already classified as qualified investors under Russian law will also be eligible.

Financial institutions seeking exposure to cryptocurrency will be subject to regulatory requirements. These rules will depend on the risk level of the digital assets involved.

Ban on General Crypto Transactions

Despite the shift, the Bank of Russia maintains that private cryptocurrencies are highly volatile and lack guarantees from any jurisdiction. It does not recognize cryptocurrency as a legal payment method.

The regulator proposes banning cryptocurrency transactions between Russian residents outside the ELR. It also plans to introduce penalties for violations.

Outside the ELR, qualified investors may invest in securities, derivatives, and digital financial assets linked to cryptocurrency prices. However, these investments must not involve the direct transfer of digital assets.