Russia weighs allowing banks and securities firms to run crypto exchanges under a notification-based regime

The Bank of Russia is considering introducing a “notification-based” regime that would allow banks and securities firms holding existing financial licenses to operate virtual-asset (cryptocurrency) exchanges without a separate approval process.

According to The Block on the 6th (Korea time), Elvira Nabiullina, governor of the Bank of Russia, said in an interview with Interfax that she has proposed a plan that would enable banks and brokers to obtain authorization to operate crypto exchanges by leveraging their existing financial licenses.

If implemented, the plan is expected to allow financial institutions to provide virtual-asset trading services by notifying the supervisory authority, without separately obtaining a new virtual-asset service provider license.

The proposal is based on the fact that these banks and securities firms already have anti-money laundering (AML) and counter-terrorist financing (CFT) systems in place. Nabiullina said, “The banking system is built on the basis of AML and CFT.”

Still, Russia is expected to apply strict risk-management standards to the financial sector’s participation in the virtual-asset market. Nabiullina explained, “We are considering limiting the level of risk a bank can take in the virtual-asset market to 1% of its own capital,” adding, “We will first apply the 1% cap and monitor banks’ operations.”