Cash to Crypto Trade Blooming in Moscow, Reports Say

Buying cryptocurrency in Russia these days increasingly means parting with fiat cash, be it Russian rubles or American dollars. According to numbers quoted by local media, the 24-hour market turnover, just in Moscow, reaches a staggering $50 million dollars on peak days. Some say the cash-crypto trade resembles the wild-wild-east street forex of the 90s, while others claim that if it’s not prohibited then it’s allowed.      

Also read: Ukrainians Advised to Pay 19.5% Tax on Crypto Incomes

Last year’s skyrocketing prices have tremendously increased the popularity of cryptocurrencies around the world and Russia is no exception. The 2017 all-time highs drew a lot of attention and investment creating a multi-million dollar cryptocurrency market in Moscow which is still blooming. A big part of it involves cash transactions and as there are no dedicated regulations in the country yet, this type of crypto trading is neither legal nor illegal. According to estimates quoted by the local press, the daily crypto turnover in the capital alone is between $10 and $20 million USD but it sometimes peaks at $50 million.

According to Roman Zaguba, a representative of the UK-based crypto bank Wirex, most of these exchangers dwell on peer-to-peer platforms like Localbitcoins. Because of the lack of relevant laws, online trading platforms are also entirely outside of the legal field. The draft legislation that was voted on first reading in May and was supposed to be adopted in July has been delayed. The texts of the initial three bills have been synchronized and the revamped law “On digital financial assets” will be presented for public discussions in October before it’s reviewed again in the State Duma and hopefully adopted by the end of the year. Quoted by BFM, Zaguba added that the legal document contains definitions such as “exchange operators” and he believes the term applies to cryptocurrency exchanges that will be allowed to trade digital coins with fiat money.

As part of the investigation, Vedomosti journalist Alena Sukharevskaya visited the office of one of the companies offering exchange services on the market in the Moscow International Business Center, also known as the Moscow City. Denis Polohin, founder of the Berkut Corporation, told her the number of deals worth over $100,000 had increased in the last couple of years. About 50% of the deals are sealed with investors that want to participate in initial coin offerings (ICOs), 10% of his clients are traders and 10% dealers. Another Moscow City-headquartered company, the International Cryptocurrency Center, which trades digital assets in partnership with the Estonian firm Aridika Asset Management, said it had between 10 and 15 customers every day.

What is your opinion about the cash-crypto trade? Share your thoughts on the subject in the comments section below.

Images courtesy of Shutterstock.

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