The Russian Central Bank has reported a significant increase in transactions on crypto exchanges and peer-to-peer trading platforms among Russian citizens. The bank noted a 16.4% increase in total web traffic to cryptocurrency platforms from the fourth quarter of FY2023 to the first quarter of FY2024, with Russians making a total of 104.6 million visits to these platforms. The average monthly number of unique Russian IP address-holders to major crypto exchanges also increased by 15.1%, with 7% of all traffic on these exchanges originating from Russia.
The report suggests that Russians are showing interest in higher-cap cryptoassets such as Bitcoin and Ethereum, as well as USD-pegged stablecoins like USDT and USDC. Transactions potentially attributable to Russians amounted to over $50.2 billion in the same period, including crypto trades, P2P payments, remittances, and payments for goods and services. The Russian Central Bank warned of the risks and dangers associated with holding crypto in Russia, urging users to assess the risks of possible sanctions from unfriendly countries.
The bank did not disclose the specific crypto platforms it monitored but previous reports have included data from platforms such as Binance, Bybit, MEXC, and KuCoin. The spike in transactions may be linked to Binance’s exit from the Russian market, as the platform had previously held a significant share of the nation’s crypto market. The bank cautioned Russian crypto users about the potential risks of holding stablecoins like USDT and USDC, warning of the possibility of losing access to funds in the event of sanctions or restrictions.
In light of increasing scrutiny of stablecoin transactions by regulators in the US and UK, the Russian Central Bank recommended domestic financial organizations to refrain from offering financial instruments tied to cryptoassets and advised against advertising services related to cryptoasset circulation. The report also alluded to forthcoming Russian regulations regarding cryptoassets, suggesting that financial providers should prepare for potential changes in the regulatory landscape. Overall, the report highlights the growing activity of Russian citizens on crypto platforms and the need for caution in light of evolving regulatory and geopolitical risks.
