Russia’s Central Bank has approved the trading of financial instruments tied to crypto prices for qualified individuals.

However, these instruments must be non-deliverable, meaning investors won’t be able to hold the digital assets; instead, they will only receive payouts based on price movements.

Strict Risk Controls

In a May 28 press release, the central bank confirmed that Russian financial institutions are now allowed to issue financial derivatives, digital financial assets (DFAs), and other securities pegged to cryptocurrencies. Nevertheless, access to these offerings is strictly limited to investors who meet certain legal criteria, with the general public remaining excluded.

The financial regulator has also adopted a conservative risk approach. Credit institutions must fully back such positions with capital and implement individual exposure limits. These measures are meant to reduce the impact of crypto price fluctuations and prevent broader financial risks, with plans of formalizing the requirements within the year.

Despite this update, the Bank of Russia is maintaining its broader opposition to cryptocurrencies and will continue to advise against direct investment in them.

Broader Efforts to Advance Crypto Regulation

This move follows similar efforts to create a legal framework for digital assets in Russia. The government is currently reviewing proposals from the monetary authority for a pilot program that would restrict crypto transactions to certain categories of investors. To qualify, participants must hold at least $1.1 million in securities and deposits or have earned over $570,000 in the previous year.

The pilot, introduced in March, is expected to run for three years if approved and could play a key role in shaping the future of digital asset use within Russia’s financial system.

Similarly, the Russian Finance Ministry and the national bank have begun laying the foundation for a government-run crypto exchange that is expected to launch in the coming months.

According to local media reports, Finance Minister Anton Siluanov revealed that the initiative would support the legalization of crypto use and bring digital transactions under regulatory oversight.

The exchange will operate within the country’s experimental legal framework for financial innovation and will be open only to a limited group of approved investors for conducting regulated crypto transactions.

Deputy Finance Minister Ivan Chebeskov also highlighted that the platform could be developed using existing financial infrastructure or by newly licensed entities.

Meanwhile, Russia continues to use cryptocurrency in oil trade with India and China. Last year, Siluanov confirmed that domestic businesses have been using digital assets to work around economic sanctions imposed by the United States and its allies after Moscow invaded Ukraine in February 2022.

One hundred days after the Markets in Crypto-Assets (MiCA) framework took effect, most of the crypto industry is still racing to catch up.

On April 14, Circle’s executive Patrick Hansen, citing data from the European Securities and Markets Authority (ESMA), reported that only 11 stablecoin issuers and 15 crypto-asset service providers (CASPs) had received authorization.

The low figures underline the sector’s ongoing struggle to meet MiCA’s compliance requirements.

Hansen emphasized that without a MiCA license, crypto firms cannot passport their services across the 30 countries in the European Economic Area (EEA). This restriction is driving companies to accelerate their licensing efforts.

However, Hansen identified some key gaps, such as the fact that no asset-referenced token (ART) issuers have yet been authorized.

He also noted that regulators have received only about 25 white papers for digital assets that do not fall under EMT or ART classifications. This covers large-cap tokens such as Bitcoin and Ethereum.

As a sign of increasing enforcement, Italy’s financial authority, CONSOB, has added 15 names to its list of non-compliant entities, reflecting growing scrutiny under the new framework.

Licensed stablecoin issuers

Since MiCA took effect, 11 stablecoin issuers from six EU countries have been approved to issue e-money tokens (EMTs). So far, regulators have authorized 16 EMTs, 10 pegged to the euro and six to the US dollar.

The list of approved entities includes Circle (issuer of USDC), Banking Circle, Fiat Republic, Quantoz Payments, Membrane Finance, Salvus, Societe Generale, StablR, Stablemint, and Schuman Financial.

Meanwhile, Tether, the issuer of the world’s largest stablecoin USDT, remains absent from the list. Its failure to comply with MiCA standards has led to delistings from several EU-based exchanges.

However, Tether has touted its Handron platform and investment in Quantoz Payments as its answer to the regulatory challenge.

MiCA-compliant CASPs

On the CASP front, ESMA has listed 15 authorized providers.

These include major crypto platforms like Crypto.com, OKX, Bitpanda, eToro, and Crypto Finance, alongside traditional financial institutions like BBVA, Clearstream, and Flatex.

Notably, some previously listed firms, such as MoonPay and Hidden Road, no longer appear on the registry. This could suggest changes in their status or ongoing regulatory review.

Germany currently leads the region with six licensed CASPs, followed by Malta with five.

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