Russia has embraced cryptocurrencies as a practical tool for international trade but remains firm in excluding them from its National Wealth Fund (NWF). The country’s Finance Ministry has reiterated its stance, emphasizing the high volatility and liquidity risks associated with digital assets.
No Plans for Crypto in NWF Holdings
Deputy Finance Minister Vladimir Kolychev confirmed that the government has no intention of integrating digital assets into the NWF. Speaking to Interfax, he stated unequivocally that the fund will continue holding only gold and Chinese yuan. According to current regulations, the NWF may allocate up to 60% in yuan and a maximum of 40% in gold.
Kolychev dismissed any prospects of altering the fund’s investment structure to include cryptocurrencies. “From a sovereign budget reserve perspective, it is crucial that the fund’s assets are highly liquid and can be quickly sold without significant loss in value. Digital assets are highly volatile, so we have never considered them for the NWF and have no plans to do so in the future,” he explained.
The minister also indicated that riskier investments might only be considered once the NWF reaches 7–10% of GDP. However, with its current holdings at 5.6% of the projected 2025 GDP, such changes remain unlikely in the near term.
Russia’s Pragmatic Approach to Cryptocurrency
While Russia refuses to hold digital assets in its sovereign reserves, the government has taken steps to regulate cryptocurrency transactions. In November 2024, the Russian parliament passed legislation recognizing Bitcoin and other cryptocurrencies as taxable assets, with a personal income tax rate of 13–15% on crypto transactions. The law awaits President Vladimir Putin’s approval.
A report by the Bank of Russia in December 2024 revealed that Bitcoin dominates the nation’s cryptocurrency holdings, accounting for 69% of Russians’ total exchange-based crypto assets as of September 2024.
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Despite rejecting digital assets for national reserves, Russia continues to use Bitcoin strategically in international trade, leveraging it as a financial instrument to navigate sanctions while keeping it outside its sovereign investment portfolio.
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