Russia’s Largest Bank Starts Issuing Bitcoin Bonds

Sberbank, Russia’s largest financial institution, has announced the issuance of the first batch of structured bitcoin bonds. The instruments are currently offered to a limited number of qualified investors, but the bank expects to provide more crypto-linked securities soon.

Sberbank Pioneers Bitcoin Bonds in Russia

Cryptocurrency is slowly starting to become a mainstream asset in Russia, as institutions like banks are including these as part of their investment portfolio offerings. Sberbank, Russia’s largest bank, with over $550 billion in assets under management (AUM), has started offering bitcoin-structured bonds to its customers.

According to local media, the bank is already offering these bonds to a limited number of qualified investors over the counter. A bank spokesperson stated that these bonds presented investors with two different ways for accruing income: the increase in the price of the bitcoin in U.S. dollars, and also the strengthening of the U.S. currency against the ruble.

The products, under Russian law, are being priced in Russian rubles. Sberbank would be the first bank to open the cryptocurrency markets to qualified investors. This development follows the central bank’s approval for financial institutions to develop crypto-linked opportunities, including securities, derivatives, and digital financial assets.

Nonetheless, the central bank required full capital coverage and individual limits for these instruments, and also warned these institutions against conducting direct cryptocurrency investments.

Sberbank stated that the bank aims to expand its cryptocurrency lineup, developing similar cryptocurrency-linked bonds that could be listed on the Moscow Exchange. This means that similar bonds linked to cryptocurrencies like ether, solana, or XRP could also be launched by the bank soon.

Similarly, the bank will also offer other instruments, like futures, to its customers through its investment platform after their launch on the Moscow Exchange. The exchange has announced that it intends to do so in June, opening the cryptocurrency-linked securities market to more qualified investors.

The announcement shows Russian investors have an appetite for this kind of crypto instrument, which can produce high gains due to bitcoin’s price growth potential.

Read more: Russian Central Bank Greenlights Crypto-Linked Products for Qualified Investors