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After the harsh sanctions restrictions of 2022, Russian investors' access to the U.S. stock market through traditional brokerage accounts has been virtually blocked. However, the enterprising part of market participants quickly found an alternative workaround. This refers to tokenized stocks and crypto derivatives on foreign platforms. They allow investors to earn income from changes in the value of U.S. company securities, using cryptocurrency for settlements. There is no consensus on how widespread this practice is, what dangers it poses for Russian citizens, and how it aligns with upcoming legislative changes.

Scale of the Phenomenon: From a Niche Tool to a Mass Trend

Igor Plotnikov, Executive Director of Millpay, rates the popularity of the new tool the highest. According to him, tokenized shares of U.S. companies on platforms like Bybit, Binance, and Deribit are in high demand among Russians. They are most often chosen by active traders and those investors who have long worked with digital assets. The current market situation adds relevance to the tool, as there is now a downturn in the crypto market against a backdrop of a strong revival in the stock market.

Although there is no precise open statistical data, Igor Plotnikov suggests relying on indirect information. Heated discussions in specialized communities and high traffic on exchanges prove that this is one of the most sought-after ways to invest in the U.S. Our interlocutor explained the attractiveness of the method as follows:

The derivatives themselves are created on securities of the most popular technology giants. Incidentally, amid the rapid rise in oil and gold prices, platforms have begun actively offering instruments on commodities as well.

The other speakers assess the prevalence of the tool much more cautiously. For example, Alexander Nam, Vice President of Digital Assets at MTS Fintech, calls trading U.S. stocks via cryptocurrency the domain of a narrow circle of experienced players. Yaroslav Kabakov, Director of Strategy at IC "Finam," agrees with this view. He considers such a practice exclusively niche.

Legal and Sanction Risks: A Unified Danger Zone

In assessing potential threats, the experts' positions largely coincide. Yaroslav Kabakov points to increased legal, sanction, and infrastructure risks. In this case, the investor is completely dependent on the rules of a specific foreign platform. Consequently, they may at any moment face asset freezes, left without the usual protection of property rights.

Alexander Nam divides all client concerns into three categories:

• Legal dangers: related to the complete uncertainty of the legal status of transactions and complex tax accounting.
• Sanction risks: expressed in the high probability of account blocking due to Russian citizenship.
• Infrastructure problems: a tokenized instrument never guarantees legal rights to ownership of the underlying asset.

Igor Plotnikov emphasizes the nature of this financial instrument. 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 actual securities. The legal status of transactions is in a gray area due to the lack of clear regulation.

Fyodor Ivanov, Director of AML/KYT Analytics at operator "SHARD," suggests distinguishing risks based on the type of platform used. On centralized exchanges, difficulties are related to compliance, which has become too demanding for users with Russian passports. On decentralized platforms, the analyst sees no particular risks beyond the standard loss of funds due to high volatility.

Here is how Fyodor Ivanov formulates the main problem:

When bringing such funds into the Russian regulated framework, the question of the legality of their origin remains open. Moreover, the difficulty lies not so much in explaining the origin of the funds to the bank, but in ensuring that a bank working with cryptocurrency understands these explanations.

Considering Regulatory Norms: Legalization or Displacement?

Yaroslav Kabakov believes that Russian legislators will bet on licensed digital instruments within the national financial system. Operations through uncontrolled foreign crypto exchanges will not be supported. Alexander Nam specifies what the legal products might be. Most likely, investors will be offered digital financial assets (DFAs) on foreign securities, tokenized RWAs, and various structural solutions. In his opinion, their active development will eventually displace the gray market segment.

Igor Plotnikov views regulation from a different angle. For him, this is not about displacing players, but about long-awaited clarification of the rules of the game. He explains that after the law on digital currency comes into force, citizens will be able to legally buy tokenized assets with cryptocurrency. Restrictions will only affect the use of Russian payment infrastructure. That is, buying USDT for rubles on a domestic licensed platform, transferring them abroad, and purchasing assets there is legal. However, buying them on a foreign exchange directly for rubles will be prohibited. In practice, this is currently impossible anyway, as foreign platforms do not accept rubles.

Conclusions and Expert Opinion from Cryptalist

The main divergence among experts lies in assessing the scale of trading. Igor Plotnikov considers this method a popular way of investing among active traders from Russia. Alexander Nam and Yaroslav Kabakov classify it as a narrow niche for professionals.

In describing the risks, the analysts are unanimous. The speakers emphasize that a tokenized stock is merely a derivative without rights to the real asset. Because of this, the investor is vulnerable to sanctions and freezes. Fyodor Ivanov also reminds of the problem of confirming the legality of income when returning it to Russia.

As for the future, Yaroslav Kabakov and Alexander Nam expect the emergence of safe domestic DFAs.

Cryptalist Comment: The current situation is a classic example of an arbitrage between accessibility and security. Crypto derivatives give Russian investors a unique opportunity to stay in the game on the U.S. market, but this comes at the cost of a lack of legal protection and the risk of blockages. Personally, I recommend considering this tool exclusively as a temporary solution until regulated alternatives appear. Playing with "gray" derivatives requires from an investor not only market savvy but also a readiness for a total loss of capital in the event of force majeure from the exchange.