The Bank of Russia has come out against letting everyone on the domestic market freely use non-custodial crypto wallets. Regulators are worried this move could be seen as a workaround for sanctions and could add extra risks when it comes to FATF requirements.

What happened

The central bank rejected the idea of launching an experimental regime that would have allowed all crypto market participants to use non-custodial wallets.

Why the regulator is pushing back

The regulator believes expanding access to non-custodial wallets could be viewed as a tool for dodging sanctions. That brings more regulatory and compliance headaches, especially when it comes to FATF standards, so they're calling for a much more cautious approach.

How things stand now

Right now, non-custodial wallets are only allowed for companies involved in foreign economic activity (FEA) and only under a controlled mechanism. The Bank of Russia wants to see how this setup works in practice and analyze the results before thinking about letting the rest of the market in.