Trading US stocks through crypto derivatives: a new path for Russians or a minefield?
After the introduction of strict restrictions in 2022, Russian investors' access to the U.S. stock market through classic brokerage accounts was virtually blocked. However, the most enterprising part of the market quickly found an alternative workaround. This refers to tokenized stocks and crypto derivatives on foreign platforms. These instruments allow investors to profit from changes in the value of U.S. company shares, using cryptocurrency for settlements. But how widespread is this practice, what dangers does it pose, and how does it relate to upcoming legislative changes? Let's figure it out.
Scale of the Phenomenon: A Niche Instrument or a Mass Trend?
Expert opinions on this issue are divided. On one hand, representatives of the crypto industry, such as the executive director of Millpay, note the high demand for tokenized shares of tech giants on platforms like Bybit, Binance, and Deribit. According to him, they are chosen by active traders and those investors who have long been working with digital assets. Indirect data — heated discussions in specialized communities and high traffic on exchanges — confirm that this is one of the most sought-after ways to invest in the U.S.
On the other hand, a number of analysts, including the vice president of digital assets at MTS Fintech and the director of strategy at IC Finam, assess the prevalence of the instrument much more cautiously. They call trading U.S. stocks via cryptocurrency the domain of a narrow circle of experienced players, an exclusively niche practice. In their opinion, this path is too complex and risky for the mass investor.
Legal and Sanction Risks: What is the Main Danger?
In assessing potential threats, experts, on the contrary, are unanimous. Yaroslav Kabakov highlights three key categories of risks:
- Legal risks: complete uncertainty about the legal status of transactions and complex tax accounting.
- Sanction risks: high probability of account blocking due to Russian citizenship.
- Infrastructure risks: a tokenized instrument never guarantees legal rights to ownership of the underlying asset.
It is important to understand that any tokenized stock is a derivative that is entirely dependent on the exchange that issued it. If the platform runs into problems, the trader risks being left with nothing, as they have no rights to the real securities. The legal status of transactions is in a gray area due to the lack of clear regulation.
Fyodor Ivanov, director of analytics at AML/KYT operator SHARD, adds to this picture, emphasizing the difficulties in confirming the legality of income when returning it to the Russian regulated financial system. It will be extremely difficult for a bank to explain the origin of funds obtained from operations with crypto derivatives on a foreign platform.
The Future: Displacement of the "Gray" Segment or Legalization?
Most analysts agree that Russian legislators will bet on licensed digital instruments within the national financial system. Operations through uncontrolled foreign crypto exchanges will not be supported. Most likely, investors will be offered digital financial assets (DFAs) for foreign securities, tokenized RWAs, and various structural solutions. Their active development over time will likely displace the gray segment of the market.
Another point of view suggests that after the law on digital currency comes into force, citizens will be able to legally buy tokenized assets for cryptocurrency. Restrictions will only affect the use of the Russian payment infrastructure. That is, buying USDT for rubles on a domestic licensed platform, transferring them abroad, and purchasing assets there will be legal. Buying them on a foreign exchange directly for rubles will be prohibited, although technically this is already impossible, as foreign platforms do not accept rubles.
Expert conclusion from Cryptalist: Trading U.S. stocks through crypto derivatives is a high-risk instrument that is only suitable for experienced market participants ready to lose capital. While regulation remains uncertain and sanction risks are high, I would recommend that Russian investors refrain from this path and wait for the emergence of safe and legal domestic alternatives, such as DFAs. Playing in the "gray zone" could result in a total loss of funds without any legal protection.