The Russian Central Bank has reported that crypto exchange transactions in 2023 amounted to almost $52 billion, with over $51.67 billion worth of Bitcoin and Ethereum transactions potentially traceable to Russian citizens. However, the bank admitted that most Russians do not use major crypto exchanges, indicating that the actual figure could be much higher. The Central Bank’s annual report on the financial year revealed that the volume of Bitcoin and Ethereum transactions on large crypto exchanges potentially attributable to Russians was 4.78 trillion rubles.
Despite the high volume of transactions on crypto exchanges, the Central Bank noted that the peer-to-peer (P2P) market has become the main channel for acquiring crypto assets in Russia. In the first half of 2023, the average monthly volume of P2P transactions among Russians increased by more than 50%, indicating a shift away from traditional exchanges. The bank’s data on crypto exchanges was calculated using the blockchain analytics tool Prograchniy Blockchain, developed by Rosfinmonitoring, the nation’s anti-money laundering agency.
The Prograchniy Blockchain tool is said to be accurate in tracing citizens’ transactions across multiple blockchain networks, providing data on both the sender and recipient of crypto asset transactions. In a report from 2023, Rosfinmonitoring claimed that the tool helped solve a crypto-powered contract killing case, highlighting its effectiveness in tracking illicit activities. The use of blockchain analytics tools by government agencies underscores the importance of identifying and monitoring crypto transactions to prevent illegal activities.
In June 2023, a Russian IT firm reported that almost $300 million worth of crypto trades are made available daily on the nation’s P2P market, indicating the growing popularity of decentralized trading platforms among Russian citizens. Despite this increase in P2P transactions, the Central Bank noticed a decline in the number of Russians using major overseas crypto exchange platforms to buy and sell crypto. The shift towards P2P trading could be driven by factors such as privacy concerns, transaction fees, and accessibility to a wider range of digital assets.
The Central Bank’s recognition of the P2P market as the primary channel for acquiring crypto assets in Russia highlights the evolving landscape of the country’s cryptocurrency industry. With the increasing adoption of blockchain analytics tools and the development of domestic trading platforms, Russian citizens have more options for accessing and trading digital assets. As regulatory frameworks continue to develop and adapt to the growing demand for cryptocurrencies, the Russian crypto market is poised for further growth and innovation in the coming years.
