Crypto

Bank of Russia Considering Prohibiting Mutual Funds From Investing in Crypto

Bank of Russia Considering Prohibiting Mutual Funds From Investing in Crypto

In Russia, mutual funds will not be permitted to offer crypto exposure to qualified or unqualified investors.

The Russian central bank has maintained its tight stance on the cryptocurrency business, with mutual funds now explicitly prohibited from investing in cryptocurrencies such as Bitcoin (BTC).

The Bank of Russia issued an official address on Monday, December 13 about the regulation of mutual investment fund investment opportunities.

Even though the document expands the number of assets allowed for mutual funds to participate in, it prevents fund managers from buying cryptocurrencies and “financial instruments whose value is based on the prices of digital assets.”

Mutual funds are not allowed to provide crypto exposure to qualified or unqualified investors, according to the statement.

In July 2021, the Bank of Russia suggested that asset managers prohibit cryptocurrency from mutual fund exposure. Despite the lack of a legal ban, there have been no Russian mutual funds with crypto exposure, according to a report by local news agency RBC.

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According to reports, Russia now has only one industry-related exchange-traded fund (ETF), according to Artem Deev, head of the analytics department at brokerage house AMarkets. According to Deev, the fund is administered by “BrokerCreditService,” a joint-stock management organization that invests in companies focusing on decentralized data storage and blockchain, such as Jack Dorsey’s Block, PayPal, and Broadcom.

According to Sber’s asset management chief Vasily Illarionov, Russia’s largest bank is aiming to introduce a blockchain-focused ETF. The ETF will be dubbed “Blockchain Economy” and will invest in blockchain-related stocks. The fund, according to Illarionov, is not subject to Bank of Russia limitations and can be marketed to ordinary investors.

As previously reported, the Bank of Russia has adopted a tough position on cryptocurrencies, prohibiting several major banks from providing cryptocurrency investing services. Such services, according to the authority, do not “meet the interests of investors and bear considerable risks.”

The Author

Samuel Adeshina

Samuel is a financial reporter whose interests include blockchain, market, business, insurance, and Crypto to provide relevant information to all interested.