Competition will force Russian banks to reduce spreads on cryptocurrency.
The launch of cryptocurrency banking operations in Russia will be marked by inflated spreads, but maintaining a markup of 5–7% or higher in a competitive market will not be possible. This conclusion is evident after analyzing the current market conditions and player behavior. The key factor determining the price for the client will not be the bank's appetite for profit, but rather liquidity costs, the audience's willingness to overpay for a regulated framework, and the difference compared to familiar fiat transfer channels.
Why spreads will be high at first and then decline
At the initial stage, banks are forced to factor significant expenses into the cost: liquidity, compliance, hedging, and the creation of new infrastructure. In certain products, the markup could reach several basis points. However, figures like 5–7% are not viable in the long term. As new banks and regulated participants enter the market, margins will begin to compress fairly quickly.
The spread, in essence, is shaped by the market itself, not the regulator. It is composed of the global price of the crypto asset, the cost of liquidity, hedging, infrastructure, and the specific bank's margin. The Bank of Russia is expected to regulate access rules, the composition of participants, and infrastructure, but it will not set fixed buy and sell quotes. This means that markups across different banks could vary significantly.
Within a single bank, the spread will depend on the number of active product users, the volume of real user liquidity in the order book, and the cost of liquidity for the bank itself, which will be required on balance sheets in significant amounts. Infrastructure costs and the legal structure are secondary factors, although still important.
Who will win the competition for users
Victory will go to those with the largest marketing budget and the greatest willingness to take risks to dominate the new economy. This is not just about qualified investors. The more liquidity providers and competition among banks, the closer prices will be to market levels. The mechanism here resembles the currency market rather than a product with an administratively set tariff.
The mass-market client is currently not ready to overpay merely for the word "bank." The stress level of the retail audience has been high since 2022: the Russian user is willing to accept many scenarios to meet their needs, except one—an unjustifiably high cost of service. But wealthy clients are a different story. 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. For such a client, the question of "your own accountant or a Russian bank" seems rhetorical.
My view: reducing spreads to competitive levels is a matter of time, but not an instantaneous process. Banks that are the first to build reliable infrastructure and offer fair prices will capture the most profitable clients. The rest will have to catch up, and that will be more expensive than entering the market now.