Similar To China, Bitcoin OTC Trading Is On The Rise In Russia
Apparently, the daily trading volume for established cryptos such as BTC and ETH can peak at $50 million. While this figure is a small fraction of the typical crypto exchange trading volumes, is of significance due to the ambiguity of Russia’s crypto regulatory space. As of now, Russians are allowed to invest in digital assets. However, the source of the crypto assets must be legitimate. According to Aleksei Karpenko, a senior Russian lawyer, investors are permitted to carry out transactions that are not explicitly prohibited by the state.
The sluggishness in the development of Russia’s crypto space is heavily attributed to the absence of relevant regulatory framework. Though citizens can freely invest in cryptos, companies have reservations due to the lack of clarity in the regulations. Moreover, this ambiguity is expected to persist for the near future, especially after the postponement of 3 bills seeking to introduce crypto regulations. The government-drafted bills are scheduled for approval at the end of the year.
Since they depend on global cryptocurrency exchanges, the Russian OTC platforms charge high commission rates which go up to 2%. As a result, these enterprises make profits worth thousands of dollars on a daily basis, despite having a low number of active customers.
China Following Suit?
Unlike Russia, China’s ban on cryptocurrency trading cuts across all types of transactions. Therefore, Chinese locals can neither buy nor hold digital currencies. Nevertheless, the Hong Kong-based South China Morning Post recently reported that Chinese activity on crypto exchange platforms is still noticeable. Seemingly, the recent elimination of fintech and OTC platforms form China’s mainland has been ineffective.
In China, it is impossible to buy cryptocurrencies using the Yuan due to the stringent laws imposed by local financial regulators. However, local investors are circumventing this by creating shell accounts in Hong Kong, enabling them to acquire digital assets easily. As per Terence Tsang Tsang, an executive ta the Hong Kong-based crypto exchange Tidebit, the increased monitoring of alien companies aims to identify small exchanges that were masquerading as foreign platforms and illegally operating within Chinese territory.
Evidently, no government can entirely abolish cryptocurrency trading within its borders. Usually, crypto enthusiast in such countries direct their assets to offshore markets as alternative to unfriendly regulations. Therefore, it is highly likely that crypto trading will persist in China and Russia, irrespective of the stance adopted by the local administrations.