The Russian Central Bank has observed a significant increase in citizens' transactions on crypto exchanges and peer-to-peer trading platforms.
According to RBC, the bank's financial stability report highlighted several trends in Russian citizens' crypto transactions. The report noted that from the fourth quarter of the Financial Year 2023 to the first quarter of FY2024, the "total web traffic of Russian users on the websites of the largest cryptocurrency platforms" rose by 16.4% "compared to the second and third quarters of 2023."
Russian Central Bank: More People Using Cryptocurrency Platforms
According to the bank, 104.6 million visits to P2P and cryptocurrency trade websites were made by Russians.
According to the bank, there was a 15.1% increase in the average monthly count of distinct Russian IP address holders to "major crypto exchanges."
According to the bank, this indicates that 7% of all traffic on these significant international cryptocurrency exchanges comes from Russia.
Still, this falls short of the bank's stated 9% peak from the first quarter of FY2023.
The bank claimed to have performed its computations using a program called Transparent Blockchain.
The Federal Financial Monitoring Service, often known as Rosfinmonitoring, created the technology in an effort to combat money laundering using cryptocurrency.
According to the report, Russians are still interested in larger-cap cryptoassets like Ethereum (ETH) and Bitcoin (BTC). They also seem to be using stablecoins that are pegged to the USD, such as USDT and USDC.
Over $50.2 billion worth of transactions were "potentially attributable" to Russians overall during that time.
Analysts pointed out that this covers not just cryptocurrency trades but also peer-to-peer transfers, remittances, and "payments for goods and services."
Crypto Is Dangerous, Says Regulator
The Russian Central Bank report "does not publish a list of the crypto platforms it has monitored," according to an RBC investigation.
It did, however, note that information from "previous Central Bank financial risk reports" had come from Bit.ly, Binance, MEXC, KuCoin, and other platforms.
One reason for the increase in transactions could be Binance’s exit from the Russian market. The bank estimates that Binance controlled nearly half of the nation's crypto market at the time of its departure.
The bank also warned Russian crypto users about the "dangers and risks" of holding crypto in Russia. It emphasized the "necessity to assess the risks associated with possible sanctions from unfriendly countries."
With rising tensions between the West and Moscow, the bank claimed that Russian holders of USDT and USDC risk "loss of access to their funds" if they are blocked by stablecoin issuers. Such losses "cannot be ruled out."
RBC noted that regulators in the US and UK are increasing their scrutiny of "transactions with stablecoins" and tightening control over crypto exchanges. The bank warned that governments of "unfriendly nations" might order crypto exchanges to "strengthen control over user transactions, including within the framework of sanctions restrictions."
In its "recommendations" for Russian "financial organizations," the bank hinted at upcoming Russian regulations. It advised domestic financial providers to "not offer financial instruments tied to cryptoassets" and recommended banks "not advertise services related to the circulation of cryptoassets."
May 2024, Cryptoniteuae