Russia’s central bank intends to ban mutual funds from acquiring crypto assets or related financial instruments. The proposal, which is in line with its firm stance on decentralized digital currency, comes after the regulator urged stock exchanges to avoid trading in securities linked to cryptocurrencies.
Central Bank of Russia issues draft directive banning crypto investments for mutual funds
The Central Bank of the Russian Federation (CBR) is taking action to prevent mutual funds from investing money in digital currencies such as bitcoin. The restrictions would also apply to derivatives, the value of which depends on changes in their rates or the prices of securities linked to digital assets.
The monetary authority explained the movement with the need to protect funds and the rights of investors. The measure concerns not only unqualified investors but also accredited investors. It will be introduced by amendments to the CBR directive “On the composition and structure of the assets of mutual funds and of the assets of mutual funds” from 2016.
The Bank of Russia recently released the changes for discussion. The window to receive comments and proposals on the draft document will be open until December 27. The regulator introduced the new provisions after warning asset managers earlier this year that they should not include crypto assets in their mutual funds.
In July, the CBR advised Russian exchanges to avoid listing instruments based on cryptocurrencies and recommended that brokers and trustees refrain from offering “pseudo-derivatives with such sub-assets. associated with unqualified investors ”. The authority later said it would not facilitate access to crypto for these investors and rejected the provision of related financial services.
Survey results released this month, however, indicate that alternative assets such as cryptocurrencies make up more than half of the portfolios of unqualified investors in the country. At the time, 46% of the 1,000 survey respondents admitted that they viewed digital currencies as a hedging investment for the future.