Russia's Central Bank Proposes Rules for Trading Major Cryptocurrencies on Official Exchanges

Russia's Central Bank on Tuesday proposed a framework that would allow investors to trade Bitcoin, Ether and Tether on the country's official exchanges. The proposal builds on a law signed this month by President Vladimir Putin that formally legalizes cryptocurrency trading in Russia.

The new rules are set to take effect on Sept. 1. From that date, both retail and professional investors will need to pass a test before they are allowed to trade the three selected cryptocurrencies. The Central Bank noted that retail investors currently make up about 98% of market participants.

Restrictions and criteria

Under the new law, cryptocurrencies will be permitted for cross-border settlements but remain banned as a means of payment within Russia. The Central Bank said it chose Bitcoin, Ether and Tether because they meet requirements including a minimum five-year price history on foreign platforms, along with high liquidity and market capitalization.

Retail investors will face an annual purchase limit of 300,000 rubles (about $3,690) through each intermediary, a category that includes exchanges, brokers, asset managers and digital depositories, all of which will be closely regulated by the Central Bank. Accredited investors, by contrast, will be able to buy any cryptocurrency traded on exchange or over-the-counter markets without such restrictions.

The Central Bank has set Aug. 24 as the deadline for public feedback on the draft proposals, ahead of the framework's planned Sept. 1 entry into force.