The private banking branches of Sberbank, Russia’s national savings bank, and Alfa-Bank, a major retail bank, will offer cryptocurrency-based investment options to their clients, the business daily Kommersant reported last week. The new products will combine six of the most frequently traded cryptocurrencies, including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
The cryptocurrency composition of the portfolio will be reviewed quarterly. The weights of the digital assets will change dynamically based on a specially designed algorithm, the aim of which is to provide “significantly higher yields than individual digital assets or their indexes.”
“The client will practically receive a share in the fund. The assets of the fund are stored using custody solutions, while their security is ensured by Group IB [a major Russian cybersecurity company]. The share is liquid, which means that the client can request its equivalent in fiat money anytime,” explains Alexei Prokofiev of AddCapital, who heads the working groups in charge of preparing the project.
Only audited crypto exchanges, such as Bitstamp and Kraken, will be used for trading, said Prokofiev.
After tests on the Bank of Russia’s regulatory “sandbox” platform, the products should be made available shortly to the retail clients of the two banks.
“We aim to offer our clients an absolutely transparent entry point to digital assets, fully meeting the regulatory requirements and allowing them to invest in an interesting product,” Kommersant quoted Anna Ivanchuk, Deputy Head of Sberbank Private Banking, as saying.
Sberbank, however, is not blindly embracing cryptocurrencies. Earlier this month, the bank’s president German Gref — once known for his cryptoenthusiasm — said in an interview to Kommersant that he does not buy cryptocurrency any more. “And I wouldn’t recommend to do so to those who don’t gamble at the casino,” he added.
