Bank of Russia cracks down on crypto OTC services with new platform

The Bank of Russia is developing a new centralized platform to identify and restrict cryptocurrency over-the-counter (OTC) trading.

According to Bogdan Shablya, head of the Financial Monitoring and Currency Control Service at the central bank, the system will specifically target individuals who lend their bank accounts and cards for crypto-related transactions, pirate sites, drug shops, and online casinos, known as “droppers” or “mules.”

As per media outlet RBC , the platform is the first coordinated attempt by Russian authorities to systematically identify and block crypto OTC trading at the banking level.

While previous efforts focused on monitoring suspicious transactions within individual banks, this new system will create a unified database accessible to all Russian financial institutions. The move comes as Russian authorities estimate that cryptocurrency exchanges represent one of the largest segments using these informal banking networks.

Targeting crypto OTC infrastructure  

The Bank of Russia’s new monitoring platform is a sophisticated approach to disrupting cryptocurrency trading networks. At its core, the system will create a centralized database that tracks individuals suspected of operating as cryptocurrency transaction facilitators.

These “droppers” typically manage multiple bank accounts across different institutions to process OTC crypto trades, making them difficult to identify through traditional bank monitoring systems. The platform’s primary tech lies in its ability to share real-time information across all Russian banking institutions.

When an individual attempts to open a new bank account, the system will automatically cross-reference their information against the central database of known crypto facilitators. Banks will receive immediate alerts about suspicious applicants, allowing them to take preventive action before accounts can be used for these transactions.

According to Shablya, the current system has identified approximately 700,000 individuals involved in facilitating unofficial transactions. The platform aims to address a key weakness in existing controls, where traders could simply open new accounts at different banks after being flagged by one institution.

The scale of drop operations 

The extent of illicit banking operations in Russia appears larger than previously estimated. According to the central bank’s data, approximately 10 million Russian citizens have made transfers to accounts identified as “dropper” cards.

This is happening even though many of these individuals may be unaware they were participating in unofficial crypto transactions. While traditional suspicious banking activities through business accounts decreased to 5 billion rubles in the first nine months of 2024, transactions through individual “dropper” accounts reached 39 billion rubles in the same period.

The current figure is a major increase from previous years, with the volume growing from 37 billion rubles in 2022 to 44.9 billion rubles in 2023. Bank officials note that crypto exchanges represent one of the primary drivers of this activity, alongside online gambling and other digital services.

Implications for the Russian crypto market 

The introduction of this centralized monitoring platform is a major shift in how Russians will be able to access cryptocurrency markets. By targeting the banking infrastructure that supports OTC trading, the central bank expects to reduce unofficial crypto transactions while channeling digital asset trading through approved channels.

The immediate impact will likely force a migration away from traditional bank-based OTC trading methods. As the platform makes it increasingly difficult to use personal bank accounts for crypto transactions, traders may need to explore alternative methods or shift toward officially sanctioned platforms.

Looking ahead, the platform’s implementation could accelerate the development of Russia’s regulated cryptocurrency infrastructure. However, the ccentral bank maintains its cautious stance toward crypto.

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