Bank crypto exposure capped at 1 percent under new ratios
The Bank of Russia has released draft regulations establishing mandatory risk ratios for credit institutions investing in cryptocurrencies and foreign digital instruments. The solo and consolidated limits will be set at 1.0 percent.
One percent cap on digital holdings
Under the proposed regulatory framework, credit institutions face a strict 1.0 percent upper limit on risk ratios for transactions involving cryptocurrencies and foreign digital instruments.
The Bank of Russia designated ratio N31 for the individual bank level and ratio N32 for consolidated banking groups.
The calculation covers direct holdings as well as cryptocurrency derivative positions.
Regulators will allow institutions to net long and short positions exclusively for assets characterized by low liquidity and asset-freezing risks.
Furthermore, client holdings remain exempt from ratio calculations provided the reporting bank bears no legal responsibility if sanctions risks materialize.
Reporting timeline and enforcement
The draft regulation is undergoing regulatory impact assessment ahead of its scheduled publication in the fourth quarter of 2026.
The new requirements will take effect ten days after official publication.
Starting in January 2027, credit institutions must formally record instrument turnover and submit N31 and N32 values within their regular regulatory reports.
The central bank is currently designing the specialized reporting forms required for compliance.
Pragmatic cordon around crypto risk
The 1.0 percent ceiling effectively quarantines crypto risks without banning digital asset exposure entirely.
Permitting position netting offers necessary balance while sanctions exemptions protect lenders from client liabilities.
The framework establishes crucial supervisory oversight before exposures become systemic.