Russian banks on the brink of a crypto-boom: high spreads are inevitable, but competition will put everything in its place
The Russian banking sector is preparing to introduce cryptocurrency operations, and the first steps on this path will be marked by high service costs for clients. However, as my observations of market cycles show, this situation is temporary. The key factor that will inevitably adjust pricing is the growing competition among financial institutions.
At the initial stage, banks will be forced to build significant costs into spreads, related to ensuring liquidity, compliance procedures, hedging risks, and creating new infrastructure. As a result, the markup on individual products could reach several basis points, significantly exceeding the figures of classic crypto exchanges.
Why spreads will first rise and then go down
There is no reason to expect that a markup of 5–7% or higher will become a sustainable norm in a competitive market. As several large banks and other regulated players enter the market, margins will begin to shrink rapidly. The pricing mechanism will resemble not so much an administratively set tariff as a live currency market, where the price is formed under the influence of supply and demand.
The spread itself, in my estimation, will consist of the global price of the crypto asset, the cost of liquidity and hedging, as well as the infrastructure and operational costs of a specific bank. The regulator, represented by the Bank of Russia, will determine the access rules, the composition of participants, and the overall market architecture, but will not interfere in setting specific buy and sell quotes. This means that markups may vary significantly among different banks.
Within a single bank, the spread will depend on the number of active product users, the volume of real client liquidity, and the cost of attracting liquidity onto its own balance sheet. Infrastructure and legal aspects, although important, take a back seat compared to these operational factors.
Who will win the fight for the client
Victory in this race will go to those who can allocate a larger budget to marketing and show a willingness to take risks for dominance in the new economy. This applies not only to qualified investors but also to the mass client. The more liquidity providers there are and the higher the competition among banks, the closer prices will be to market levels.
The mass retail client, who survived the stress scenarios of 2022, is no longer willing to pay just for the word "bank." They agree to many conditions to meet their needs, but not to an unjustifiably high cost of service. A completely different picture emerges with wealthy clients. Large capital continues to migrate between countries, and with an average transaction of 3–5 million rubles, a person is willing to pay for speed, transparency, and the absence of problems. The question of whether such a client will prefer their own accountant or a Russian bank becomes rhetorical.
My conclusion: Russian banks are entering a new era, but their success will be determined not by loud announcements about launching crypto services, but by the ability to offer competitive prices and impeccable service. Those who can quickly scale and build an efficient liquidity model will take leading positions. The rest will have to settle for the role of observers in this rapidly changing market.