Russia’s Central Bank Opens Crypto Derivatives For Qualified Investors

Russia’s Central Bank has allowed qualified investors to trade financial instruments linked to cryptocurrencies. The move marks a significant shift in Russia’s cautious stance toward digital assets.

Banks and financial institutions can now develop derivatives whose returns depend on crypto prices. However, these financial products must remain cash-settled.

Russia Continues to Tone Down Crypto Restrictions

This development allows professional investors in Russia to engage with cryptocurrencies indirectly. 

Cash-settled futures are derivative instruments where investors receive profits or losses in fiat currency without physically exchanging the underlying cryptocurrency. 

For instance, an investor buying a Bitcoin future at $100,000 profits in fiat currency if BTC price rises to $105,000 within a month. The investor receives a $5,000 gain, but no actual bitcoin.

These instruments offer several advantages over direct cryptocurrency trading. Investors don’t have to handle actual cryptocurrencies, aligning with the Central Bank’s cautious approach. 

Additionally, investors can legally profit from crypto price fluctuations with fewer technical and security challenges. Regulators also find it easier to oversee and manage associated risks.

Earlier, the Russian parliament considered legislation that would grant broader access to digital financial assets for retail investors.

Previously, BeInCrypto reported that Russia’s Central Bank was planning to launch a crypto exchange for highly-qualified investors.Meanwhile, Bitcoin mining continues to show a stronghold in the country. The demand for mining equipment tripled in Russia over the past year. 

Also, earlier reports suggested that the country would add Bitcoin to its National Wealth Fund. The rumors were based on the fact that Russia became cautious after Trump’s Bitcoin reserve plans in the US.However, those reports have since been denied by authorities. 

Regardless, today’s report shows that the Russian Central Bank is slowly opening doors to crypto investments. The government is also allegedly planning a Ruble-backed stablecoin to challenge USD dominance. 

As of now, the Central Bank continues to discourage direct cryptocurrency purchases, but the new instruments provide a regulated compromise.