The Russian crypto market may become more vulnerable to external isolation: wallets of legal exchangers, exchanges, brokers, and digital depositories in Russia will be easier to track, and assets passing through them may be classified as higher risk. This assessment was given by Kirill Pistsov, Head of Product Development at the Finam financial group.
Why Sanctions Risks May Increase
According to Kirill Pistsov, the situation is changing due to updated regulations. Russian market operators must work within the legal framework, making liquidity provider addresses and the movement of digital assets more transparent. This makes it easier for foreign regulators and platforms if they decide to apply restrictions.
Against this backdrop, sanctions related to Russia’s invasion of Ukraine may have a stronger impact on digital asset operations. If cryptocurrency has passed through Russian legal infrastructure, its owner abroad risks receiving a request about the origin of funds. In some cases, a foreign platform or online digital currency exchange service may refuse to accept such a transfer.
The expert suggests that arbitrage between Russian and international platforms will become less accessible. If the connection to external liquidity weakens, a separate pricing circuit may emerge within the country, where assets trade at a discount to global quotes.
Which Assets Are Allowed and Where the Risk Is Higher
By decision of the Central Bank, only Bitcoin, Ether, and the USDT stablecoin are available in legal circulation in Russia. Other cryptocurrencies are not included in this list for public circulation within the permitted circuit: they remain outside the list that legal market participants can work with. The Bank of Russia has limited the list of instruments and set boundaries for non-qualified investors. These measures do not in themselves “color” the assets, but may reduce the depth of the domestic market.
Looking at status and usage features, the picture is as follows:
- Bitcoin: available in legal circulation; it can be stored on a hardware wallet, but when transferring abroad, there may be questions about the origin of funds.
- Ether: included in the permitted list; the same risks apply when accessing international platforms.
- USDT: available in the legal circuit, but the risk is higher due to the possibility of token freezing by the issuer.
Bitcoin and Ether purchased on a Russian platform can be stored on a hardware wallet. However, difficulties are likely when transferring to an international exchange, using a foreign custodial service, or withdrawing funds through foreign exchangers.
The risk is higher for USDT. The reason is that the stablecoin issuer can freeze tokens at holders’ addresses. Therefore, a transaction with such an asset after passing through Russian infrastructure may raise more questions from external counterparties.
“Limits for non-qualified investors and the narrow list of available assets do not automatically color cryptocurrency, but they can further narrow the domestic market,” says Kirill Pistsov.
Why the Legal Market Will Still Be in Demand
Despite the risks, Finam expects demand for regulated crypto infrastructure. For mass investors, the following are especially important:
- purchasing with rubles;
- working through a familiar broker;
- legal protection;
- clear tax accounting.
For many, investing in digital assets through a familiar circuit seems easier than working independently with foreign services.
More experienced market participants, according to Kirill Pistsov, will act more cautiously:
- monitoring the price difference inside Russia and abroad;
- maintaining the ability to withdraw assets to their own wallets;
- not being fully dependent on domestic platforms.
“Real demand will largely depend on whether Russian participants can maintain channels with external liquidity and prevent the legal market from turning into a completely closed system,” says Kirill Pistsov.
Concerns about the formation of a separate “colored cryptocurrency” market were previously expressed by Finam board chairman Vladislav Kochetkov. In his opinion, separation from global platforms may lead to a significant discount relative to international benchmarks.
The new regulatory model is associated with legislative changes: such rules pass through the State Duma and are then signed by Russian President Vladimir Vladimirovich Putin. For users, the practical effect of such norms is expressed in a narrower selection of assets in the legal circuit, limits for non-qualified investors, and increased attention to the origin of funds when transferring abroad. Against this backdrop, market participants will assess not only sanctions restrictions but also how legal crypto infrastructure coexists with traditional financial platforms, including the Moscow Exchange. Mining remains a separate area for investors, but in this story, the key question is not the mining of coins, but the further movement of assets between the Russian and global markets.
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