Russian Bank Wants to Offer Crypto Trading, But Central Policy Remains a Roadblock

Russia’s largest digital bank, Tinkoff, wants to provide clients with options to trade in cryptocurrencies. But the tough policy implemented by the country’s central bank makes it difficult for Tinkoff to move ahead with an offer. On Thursday in an interview with CNBC at St. Petersburg International Economic Forum, Tinkoff’s CEO, Oliver Hughes said “qualified investors who know what they’re doing” want to invest in cryptocurrencies. However, regarding the current challenges, he noted  “there’s no mechanism for us to offer that product to them in Russia at the moment because the central bank has got this very tough position”.

Russia Legalised Bitcoin in 2020 But Banned Payments in Digital Assets

In 2020, Russia granted legal status to cryptocurrencies like Bitcoin. But the country banned the use of digital assets in payments, claiming that the Russian Ruble was the only recognized legal tender.

But Russia remains optimistic about the prospects of digital currency — in this case central bank currencies. Elvira Nabiullina, the governor of Russia’s central bank, recently told CNBC that digital currency is the “future of our financial system”.

Compared to cryptocurrencies, which are developed with a focus on decentralization, CBDCs are only issued and authorized by central authorities. Following the Chinese and American governments, Russia is looking into a digital version of its currency.

Russian Government More Cautious About Cryptocurrencies 

Digital currencies may prove vital to the revolution of business in the future. Alexander Shulgin, CEO of Russian e-commerce company Ozon, believes that a digital Ruble will ease the process of doing business. He told CNBC, “if everyone has the opportunity to pay with digital currency online, it’s (an) easier transaction for companies like us”.

The argument for centrally regulated digital currencies has gained traction as governments become increasingly cautious about cryptocurrencies. Some of these concerns include money laundering and terrorist financing.

Furthermore, the extreme volatility recorded by crypto assets — with Bitcoin Prices falling steeply from a peak of $64,829 in April to $30,001 in May — compelled authorities to consider well-regulated stable options.

Online Russian Bank Tinkoff Believes Qualified Investors Want to Trade in Crypto

Hughes understands the concerns surrounding the use of cryptocurrency in money laundering. He’s also aware of retail investors “who see cryptos glittering at the moment and maybe make poor investment decisions.”

However, he points to professional investors who are taking an increased interest in the asset class. Speaking on the future developments, Hughes said, “hopefully over time this will evolve and we’ll be able to achieve the aims of the central bank, making sure there’s no money laundering issues, making sure we’re protecting investors, but also offer products in a responsible way”.