Competition will bring down bank spreads on cryptocurrency in Russia: market forecast
The entry of Russian banks into the cryptocurrency operations market will be marked by high spreads, but they will not be able to maintain a markup of 5–7% or higher in a competitive field. The key driver of the decline will not be the regulator's will, but the market struggle for clients.
At the initial stage, banks will be forced to factor significant costs into the price: the cost of liquidity, compliance procedures, hedging, and the creation of new infrastructure. This will inevitably lead to markups reaching several basis points in certain products. However, such figures are not viable in the long term.
Why spreads will first rise and then fall
As new players enter the market—both banks and other regulated entities—margins will begin to compress at a high rate. The market, not the regulator, will become the main arbiter of prices. The spread will be formed from the global price of the crypto asset and the added value for the liquidity, hedging, and infrastructure of a specific bank.
The Bank of Russia, it seems, will focus on regulating access rules, the composition of participants, and infrastructure, but not on setting specific quotes. This means that the variation in markups between different banks could be significant, especially at the start.
Within a single bank, the spread will depend on the number of active product users, the real client liquidity in the order book, and the cost of liquidity for the credit institution itself. Secondary factors will include infrastructure costs and the legal structure.
Who will win the battle for the client
In this race, the winner will be the one with the larger marketing budget and a higher willingness to take risks to dominate the new economy. Moreover, this is not only about qualified investors. The more liquidity providers and competition among banks, the closer prices will be to market levels. The mechanism will resemble the currency market rather than a product with an administratively set tariff.
The mass client is not yet ready to pay just for the word "bank." Since 2022, the level of stress among the retail audience has been high: users are willing to accept many scenarios to meet their needs, but not an unjustifiably high cost of service. The picture is completely different for 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 is rhetorical.
My conclusion: the banking sector faces rapid saturation, and within a year or two, we will see spreads comparable to major crypto exchanges. The regulator's task is not to hinder competition, but to ensure a level playing field.