Bank Of Russia Considers Banning Mutual Funds From Investing In BTC

The Bank of Russia considers banning mutual funds from investing in Bitcoin and will also not allow providing exposure to qualified or unqualified investors as we can see more in today’s Bitcoin news.

The Russian central bank continued its policies regarding the crypto industry and now banned mutual funds from investing in crypto such as BTC. The Bank of Russia considers banning these mutual funds from investing in BTC and released a press release as well on regulating investment opportunities by mutual investment funds. Despite the expanding number of assets available for investment, the document prohibits funds managers from purchasing crypto as well as financial instruments that value depends on the prices of digital assets.

The statement noted that mutual funds are not allowed to provide exposure to crypto both to either qualified or unqualified investors. The Bank of Russia recommended asset managers to exclude crypto from exposure in mutual funds and according to the reports by local agencies, there were no Russian mutual funds with crypto exposure despite having been no formal ban until now. Artem Deev who is the head of the analytics department at the brokerage company AMarktes said that Russia has one industry-related exchange-traded funds and according to Deev, the fund is managed by the joint-stock management company BrokerCreditService which invests in companies focused on decentralized data storage including companies like Jack Dorsey’s Block, Broadcom, and PayPal.

Russia’s biggest bank Sber is planning to launch a blockchain-focused ETF and the asset management head Vasily Illarionov noted. The ETF will be called “Blockchain Economy” and will invest in stocks that are related to blockchain technology with expectations to boost adoption. Illarionov noted that the funds don’t fall under restrictions of the Bank of Russia which can be offered to retail investors. The Bank of Russia has a harsh stance towards cryptocurrencies and barred some big banks from offering crypto services with the regulator arguing that these services don’t meet the interest of investors and can handle great risks.

In an interview with the Russian media outlets, the committee’s Chairman Alexander Bastrykin stated that the decentralized nature of the issuance of digital currencies doesn’t allow for full state control in the area. Bastrykin claimed that in some cases, the law enforces can use existing laws to seize and to freeze coins as much as they might do with bank accounts, securities, and funds. Decentralization is an issue for the agents and officers that try to do this because they are forced to seek help from crypto companies in special legal status cases to transfer the funds into the state-controlled wallets while the legal procedures are ongoing.