Early March 2022, the European Central Bank (ECB) decided to close down Sberbank Europe AG, a subsidiary of state-owned Russian Sberbank, with its headquarters in Vienna, Austria. In total, the deposit guarantee scheme in Austria expects to pay out a total of EUR 947 million. Amid the Western sanctions against Russia’s financial industry, the Central Bank of Russia (CBR) has granted Sberbank a license to issue and exchange digital assets. Crypto may be the last resort for the Russian financial industry.
It seems like a significant departure from CBR’s pre-war stance. Russian authorities previously sought to ban cryptos altogether in 2021. CBR went so far as to call them a “threat to financial stability.” With JPMorgan, a pre-war Sberbank partner, following other top investment banks and asset managers in an exodus from the country, Sberbank is betting on a crypto strategy. Since Russia invaded Ukraine, the bank lost more than 95% of its value on the London Stock Exchange.
Sberbank said its blockchain platform would guarantee digital transactions’ safety and allow companies to issue their own digital assets, attract market investments, or make other digital asset-related transactions using the platform. Reuters reported that Sberbank was actively preparing to launch its own cryptocurrency, Sbercoin.
Sergey Popov, director of the transaction business division at Sberbank, said the bank is “just starting” its work with digital assets, adding that companies will be able to make their first transactions on its blockchain in a month.
On Friday, the CBR announced that it will hold its monetary policy steady and maintain its key interest rate at 20%, but warned of considerable uncertainty as its economy undergoes a “large-scale structural transformation.” The CBR’s large quantities of foreign currency reserves were targeted by Western sanctions that aimed to render them almost inaccessible. The ruble may be in a dead-end, crypto may be one of the escape routes.
