Why Russia’s harsh 1% crypto cap actually protects bank customer assets
Summary
The Bank of Russia has proposed limiting banks’ crypto and foreign digital-instrument exposures to 1% of their own funds, with matching limits for individual institutions and banking groups. The draft covers direct holdings and crypto-linked investments, derivatives, loans and other instruments, while allowing only limited netting of qualifying lower-risk positions. Client assets in custody are excluded from the ratios if the bank is not liable for losses from seizure or restrictions; those positions would still receive a 50% risk weight, compared with 1,250% for bank-owned or liable exposures. The rules remain a draft, with publication planned for the fourth quarter of 2026 and reporting expected to begin in January 2027.
