Expobank Writes Russia’s First Crypto-Backed Loan

The amount and terms of the loan are not disclosed to the public.

Russian commercial bank Expobank has issued the first crypto-backed loan in the country, taking Waves tokens as collateral.

Reported by local business media Kommersant today, the news was confirmed by Waves co-founder, Sasha Ivanov with a retweet.

The Most Diverse Audience to Date at FMLS 2020 – Where Finance Meets Innovation

The report detailed that the personal loan was issued to Mikhail Uspensky, an entrepreneur and a tax consultant. He bought the Waves tokens in 2018 and tried to stake them for recurring gains before approaching the bank to use them as loan collateral.

The collateralized tokens are currently being held by a third-party notary. Neither the bank nor Uspensky have disclosed the amount involved in the crypto-backed loan or the terms of the agreement.

Suggested articles

PrimeXBT Brings DeFi to the Masses with Covesting Yield Account LaunchGo to article >>

Cryptocurrencies Cannot Be Used for Payments

Before issuing the loan, the bank had consulted with cryptocurrency experts and lawyers to ensure that Waves falls under the category of “other property” and is not a payment token.

Notably, the Russian government recently passed a law defining cryptocurrencies as property and banning their usage as a mode of payment. Already signed by Russian President Vladimir Putin, the new law will come into force from next January.

The bank’s legal department head Tanzila Yandieva also highlighted that this first crypto-backed loan will set a precedent in the Russian legal and banking community.

Though this type of loan with digital assets as collateral is first in Russia, the United States’ crypto-focused bank Silvergate is already offering such loans.

Expobank was previously owned by Barclays, but the UK banking giant sold it last year to local banker Igor Kim for an undisclosed sum as the bank failed to make a footprint in the market.

Got a news tip? Let Us Know