Number of Russians Trading Crypto Is Falling, Says Central Bank

Russia’s Central Bank says there has been a drop in the number of citizens trading crypto – with citizens staying away from major overseas trading platforms.

Per RBC, the bank’s data shows Russians’ crypto activity “decreased in the second and third quarters of 2023.”

The bank said it had recorded a fall in Russian visits to “the websites of the world’s largest cryptocurrency trading platforms.”

The bank added that it had noticed a drop in “the volume of [Russian-owned] cryptocurrency flowing” on exchanges.

Furthermore, the bank said, Russians have now effectively turned their backs on centralized crypto exchanges (CEXs) in favor of the P2P and OTC markets.

Earlier this year, a crypto security provider claimed that some $296 million worth of P2P crypto trades are made available every day in Russia.

The bank said that P2P transactions are now Russians’ “main channel for acquiring cryptoassets.”

Additionally, the bank claimed the average monthly volume of Russian P2P crypto transactions had “increased by 53.9% compared to the same period last year.”

The bank said Russian credit institutions were “becoming better at identifying transactions related to P2P crypto trading.”

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Russian Crypto Traders Feeling Sanctions Bite?

Many major international crypto exchanges bar Russia-based crypto traders as a result of US- and EU-led sanctions.

However, media outlets have reported that many Russians are using loopholes to evade sanctions. Many traders, they report, continue to use overseas CEXs.

Binance this year announced its “complete withdrawal from Russia” and the sale of its business to CommEX.

The firm has also halted ruble deposits on its platform and will end withdrawals at the end of January next year.

The bank warned that “alternative” CEXs could be “risky” for citizens. It warned of the dangers of platforms that specifically “target Russians.”

However, the bank suggested that the fall in crypto trading may not be due wholly to sanctions. The bank wrote:

“The activity of Russian [crypto] users fell noticeably in the third quarter. This correlates with a global decline in investor interest in the cryptoasset market.”

The bank concluded that the “share of Russian visitors” in the total number of visits made to CEXs in the second and third quarters of FY2023 had “decreased from 5.8 to 4.9%.”