Russia’s Expobank issues the world’s first crypto-backed loan
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Expobank is the first Russian Bank to make such a loan, and it follows a recent change in Russian law that recognized some types of cryptocurrency as acceptable assets. Across the globe, opportunities for investment and the use of cryptocurrencies are growing. Koinal.io offers a fast and convenient method for using bank credit cards and bank debit cards.
Russian Law on Cryptocurrency
Earlier in August 2020, Russia enacted a Digital Financial Asset law that recognized digital currency’s validity. Under the new Russian law, cryptocurrency assets can be sold, purchased, exchanged, and pledged. In Russia, the regulations do not permit the use of cryptocurrency as a cash payment. The backdrop includes a strong official sentiment against cryptocurrency as ordinary currency due to suspicions about corruption and accountability.
While their laws permit cryptocurrency as payment for goods and services, the law allows usages in other ways, including property. The Expobank loan accepted cryptocurrency as things of value sufficient to secure a loan. In that transaction, the Wave tokens were placed in escrow. The cryptocurrency owner and borrower expressed his intent not to sell the tokens and use them as assets.
Potential for Expansion
Russia’s Expobank may have set a useful precedent with the initial crypto-backed loan. Depending on the official reaction to the Expobank loan, other large Russian banks may take notice. The crypto-backed loan may emerge as a growth opportunity. There will be a remaining tension as Russia guards the Rouble as the sole unit of exchange.
Payment vs. Non-Payment Tokens
Some legal experts in Russia have commented that Wave can circulate broadly in Russia because it is not a payment token. One should note that Wave offers a blockchain service that works in the electric energy sector. The Russian government recognized Wave Enterprises as a certified software provider.
At Koinal, we take a strong interest in expanded usages of cryptocurrency around the globe. The Expobank loan demonstrates the potential for increasing the use of cryptocurrency as a tool for traditional financing. Koinal can work with purchasers to provide a seamless acquisition experience for leading currencies at some of the largest exchanges.