Two Russian banks test retail appetite for crypto-based fund
Sberbank and Alfa-Bank, two of Russia’s largest banks, are reportedly rolling out a cryptocurrency-based investment fund for retail investors.
Russia’s Kommersant published news that the two banks were set to experiment with an investment portfolio based on digital financial assets to include bitcoin, bitcoin cash, ethereum and litecoin.
Regulation of cryptocurrencies in Russia could come as soon as 29 July 2018 under draft legislation which refer to digital currencies only as “digital rights” and their exchange will be allowed. Digital assets will not be considered property but a new type of property digital rights according to the Head of State Duma Financial Market Committee, Anatoly Aksakov.
Transparent entry point
Sberbank’s deputy head of private banking Anna Ivanchuk said in Kommersant: “We want to offer our clients a completely transparent entry point for digital assets, fully in compliance with regulatory requirements and which allows investment within Russia in a product that interests them.”
A feature of the retail product, according to press reports, is that clients will be allowed to withdraw in fiat currency at any time, with crypto assets under the control of partner Group IB through bespoke “custody solutions”.
President Vladmir Putin suggested recently that “The relationship of the Central Bank of the Russian Federation to cryptocurrency [is that] it sees cryptocurrency as neither a means of payment nor a store of value. Digital currencies are not backed by anything. One should treat it cautiously, carefully.”
However, Sberbank also announced in May that it would pilot the country’s first Initial Coin Offering using the Bank of Russia’s regulatory sandbox.