It has been officially confirmed that the Russian cryptocurrency market is much larger than previously thought. According to recent figures released by the Russian Ministry of Finance, it is said that the daily trading volume alone is in the range of 5 billion rubles(— about 600 million dollars). When converted to an annual basis, it is said to exceed 130 billion dollars.

What’s interesting is that almost all of this trading is taking place outside the regulatory framework. At an Alpha Bank conference, Deputy Finance Minister Ivan Chebeskov said, “Millions of citizens are taking part in this activity, and although the scale reaches the trillions of rubles, all of it is currently being carried out in the unregulated area.” It is said that about 20 million Russians are using cryptocurrencies in some form.

So the government has started to move. Chebeskov said that a draft bill on cryptocurrency trading regulations could be submitted to the Federal Assembly sometime in March. Both the Ministry of Finance and the Central Bank of Russia are aiming to pass this bill during the spring session, with July 1 set as the final deadline. Vladimir Chistuhin, First Deputy Chairman of the Central Bank, said that the regulatory authority will provide a transition period so that market participants can obtain licenses and prepare.

A rough outline of how the regulatory system will be structured has also been released. It will primarily be governed around exchanges, with a framework in which sanctions are imposed on platforms operating without permission. Banks and brokers can provide cryptocurrency services within the scope of their existing licenses, but independent crypto platforms must obtain separate authorization.

Why does this matter? The Russian cryptocurrency market has grown rapidly because traditional financial access has been restricted due to Western sanctions. According to Chainalysis materials, Russia has become Europe’s largest cryptocurrency market by trading volume and has surpassed the UK. Sergey Shvetsov, Chairman of the Supervisory Board of the Moscow Exchange, said that Russians are currently paying about $15 billion in fees every year to overseas exchanges operating in the gray zone. This means it could become a significant opportunity if it returns to the legal domain.

Major Russian banks are also preparing. They have said they are ready to launch cryptocurrency-related products once the regulatory framework is finalized. With regulations coming in, it seems the Russian cryptocurrency market will shift from underground to mainstream. Even global exchanges like Gate will want to keep a close watch on this market change.