Bank of Russia proposes 1% crypto risk limit for banks

The Bank of Russia has proposed new draft rules to regulate how domestic banks manage risks associated with cryptocurrencies and foreign digital instruments. Under the proposed framework, banks would be subject to a 1% cap on total risk from these assets relative to their capital. This limit would apply to individual credit institutions (N31 ratio) and banking groups on a consolidated basis (N32 ratio).

The regulations aim to standardize how lenders identify, assess, and report digital asset exposure, replacing varied internal models with a consistent supervisory baseline. The scope of the rules extends beyond direct holdings to include loans, derivatives, bonds, repo transactions, guarantees, and credit lines where value or payments depend on digital assets.

To manage these risks, the central bank plans to categorize transactions into groups based on liquidity and sanctions risks. Certain crypto exposures may carry a 1,250% risk weight, while some excluded client positions could receive a 50% risk weight. Banks would be required to remain within the 1% ceiling every operating day, with the central bank authorized to take action if breaches occur on six or more days within any 30-day period. Reporting of these new risk ratios is expected to begin in January 2027.