Capital Flow or Different Worlds: Where Do Russian Investors' Money Actually Go?
In the fall of 2025, Bitcoin updated its all-time high, but this was followed by a prolonged correction. Against this backdrop, Russia tightened regulation of digital currencies, while the stock market continues to operate under clear rules and steadily pays dividends. It is logical to assume that a retail investor faces a difficult choice: where to direct their capital? However, as my analysis shows, the reality is much more complex and ambiguous.
Is there a capital shift? Opinions are divided
Alexander Peresichan from TEKHNOBIT notes that some movement of funds does exist. After Bitcoin's peak, many investors locked in profits and grew tired of volatility. Part of this capital, according to him, moved into stocks, attracted by dividend yields and transparency. However, he emphasizes that this shift is insignificant and affects only a small share of retail investors.
Yaroslav Kabakov from Finam holds the opposite view. He is convinced that there is no massive movement of funds from crypto to stocks. These instruments, in his opinion, serve fundamentally different investment strategies and audiences. Fedor Ivanov from SHARD goes even further, noting an outflow of funds from stocks into bank deposits and current consumption, rather than into cryptocurrencies.
The most categorical is Yan Pinchuk from WhiteBird. He draws attention to the fwd P/E multiplier of the Russian market, which is only 3.7 compared to the historical norm of 6.2. This indicates a deep undervaluation of domestic companies—more than 60% below average values. In his opinion, such low valuations completely refute the hypothesis of an inflow of retail capital into stocks. Rather, the market is under pressure from geopolitics and the high central bank rate.
Risk and return: crypto vs. stocks
In assessing the risk-return ratio, experts are much more unanimous. Roman Nosov from BCS World of Investments reminds that both stocks and crypto are risky assets, but the volatility and potential returns of digital coins are an order of magnitude higher. After deep corrections, both segments can show impressive growth, but over a one-year horizon, the overall risk of cryptocurrency remains undoubtedly higher.
Yaroslav Kabakov adds that "blue chips" offer much more predictable returns with significantly lower risk. Cryptocurrency, meanwhile, remains a tool for both super-profits and instant losses. Fedor Ivanov emphasizes the infrastructure risks inherent only to digital currencies, making them unattractive for conservative investors, even with the emergence of state regulation.
Competition for the same investor?
Opinions here diverge again, although most lean toward the theory of different audiences. Alexander Peresichan believes that users of these products differ greatly. Experienced traders with a diversified portfolio may overlap, but the majority of retail investors, especially young people, consciously stay in crypto, avoiding broker bureaucracy and tax reporting.
Fedor Ivanov insists that cryptocurrencies in general cannot be considered a direct competitor to the securities market. The total capitalization of the entire crypto market at $2.4 trillion is incomparable to the volume of the stock market. These are two different financial worlds. Yan Pinchuk suggests looking at the issue through the lens of economic cycles. Currently, there is no "hype" in the Russian stock market, while a crypto winter is raging in the crypto industry. In conditions of mutual decline, points of intersection are virtually absent.
My conclusion: The hypothesis of a massive capital shift from crypto to stocks finds no confirmation. The markets exist in parallel, serving different types of investors with different risk appetites. The Russian stock market, despite its undervaluation, is not yet a magnet for "crypto migrants." Rather, we are observing a general outflow of retail capital into more conservative instruments—deposits and consumption. For those ready for a long-term horizon, the current low valuations of Russian stocks certainly create an interesting entry point, but this has no relation to the movement of funds from the crypto sphere.