Russia’s Banking Behemoth Bets On Bitcoin With New Bond Offering

Sberbank, Russia’s largest bank, has started offering a new bond product tied to Bitcoin’s price. Based on reports, only qualified investors can buy these bonds right now, and trading happens over the counter.

The bank says it will soon list them on the Moscow Exchange to make them easier to buy and sell. These bonds pay out if Bitcoin rises in value, and they also give investors a bonus if the US dollar strengthens against the ruble. Investors deal in rubles, so there’s no need to own a crypto wallet or use foreign platforms.

Sberbank’s Bitcoin-Linked Bond Offer

According to the bank’s press release, the bonds are for a limited group of investors at first. They plan to make them available on the Moscow Exchange soon. This move means more transparency and the chance for more people to get involved.

If Bitcoin goes up, bondholders benefit. If the dollar goes up against the ruble, bondholders get a bit more too. It’s a double play on two markets, crypto and currency.

Regulatory Backdrop And Investor Access

Based on reports, Russia still bans cryptocurrencies for everyday payments, but they’re allowed for cross-border deals. In early June, the Central Bank of Russia gave financial firms the green light to sell crypto-related investments to qualified investors.

That change paved the way for Sberbank’s new bonds. No one needs to leave Russia’s financial system to invest in Bitcoin this way, keeping it all above board and legal.

Sberbank got a digital asset license from the Central Bank in 2022. Since then, they’ve tokenized assets like gold and real estate. They opened their platform to retail investors in 2023 and handled billions of rubles in transactions.

The bank even launched a blockchain network that works with Ethereum. That network started limited testing in 2022 and opened to the public in early 2023. Now, they’re adding Bitcoin futures on June 4 through their SberInvestments platform. This comes just as the Moscow Exchange rolls out its own crypto-based trading tools.

Around the world, big banks are moving into crypto. In the US, names like JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup are working on a stablecoin project to speed up cross-border payments. In Hong Kong, HSBC launched a crypto settlement product.

BNY Mellon is putting money into blockchain to hold digital assets. In March, BlackRock created a tokenized fund on Ethereum and then added one on Solana. Sberbank’s bond ties into this trend, showing that major banks still see value in blending traditional finance with crypto tools.

Featured image from Worldkings, chart from TradingView