Russia’s Largest Bank, Sberbank, Will Not Build Any Cryptocurrency-Focused Financial Services

Russia’s Largest Bank Will Not Accommodate Crypto-Related Businesses

  • Russia's largest bank, Sberbank has reportedly decided not to provide financial services to crypto-related firms.
  • Bitcoin and other cryptocurrencies may not be able to function as an effective medium-of-exchange (MoE).

Sberbank, the largest bank in Russia, has officially affirmed via its CEO Herman Gref that the institution will not create any service related to cryptocurrencies. The CEO, who is also a former Minister of Economics and Trade in the country, has affirmed that the bank never actually had ambitious plans for this area.

What really interests the bank right now is the blockchain technology, as the bank has several projects which are based on this technology. Gref made these statements live on TV during the Saint Petersburg International Economic Forum, an important conference in the region.

Hype Around Cryptos Appears To Have Gone

He deems as the main reason for the decision the fact that the bank was never really able to attract many crypto-related investors, as most of the clients are simply not too interested in the technology. Most of the banks doing it, he affirmed, are mostly doing it because they have a demand, something that the Sberbank doesn’t have.

The CEO also affirmed that he is pretty glad that the hype around cryptocurrencies is basically gone from the market. He believes that the regular work with the blockchain, instead, is continuing, which is very important because the technology is useful, after all, mostly than cryptos, in his opinion.

During the announcement, he also affirmed that Bitcoin (BTC) is, to him, a technical instrument in order to make transactions, not really a new kind of investment.

Lack Of Regulatory Clarity

He bought Bitcoin a long time ago when it was trading around $5 USD and used it for payments instead of saving it, but he does not seem to regret his decision, as he is “not a casino player” and believes that holding BTC is akin to betting.

The problem with BTC, in his opinion, is that some products have just become too expensive because people are using the token as an investment rather than a currency. This way, one BTC is worth a “small fortune” and it is too expensive for people to properly use it.

While the CEO did not mention this information, part of the reason why the bank is abandoning cryptos may have something to do with the current legislation of the country, or rather the lack of a proper legislation.

The Russian government has still not regulated Bitcoin. This is turning into a sort of a problem because the government is creating a huge gray area of uncertainty for the investors. Some people have even affirmed that regulating cryptos and the blockchain is not a priority anymore, so the bank may have perceived that it could run into problems.

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