Russia’s largest bank, Sberbank, plans to build out cryptocurrency infrastructure by December, according to a report Monday by Russian news agency Interfax.

A central component of the planned system will be a digital depository designed to track clients’ crypto rights and record off-blockchain transactions, Interfax reported. The depository would also process wallet transfers needed to execute client orders. Such depository functions are central to the regulatory model now being discussed because they would create formal records around client holdings and transactions handled through licensed intermediaries rather than leaving those processes solely to external wallets or trading venues.

Sberbank disclosed this month that it plans to launch a Bitcoin and crypto wallet, along with digital asset custody services, by December.

The plans come as Russia’s State Duma considers a new law, “On Digital Currencies and Digital Rights,” intended to establish a comprehensive regulatory framework for cryptocurrency in the country. The proposed legislation addresses retail purchases through licensed intermediaries, exchange trading, clearing, and digital depositories.

First Deputy Chairman Alexander Vedyakhin was quoted in the Interfax report as saying that regulators and market participants still need to prepare numerous implementing regulations. Those rules would cover depository accounting, bookkeeping, and licensing requirements for new types of intermediaries, making the final rulemaking process a key condition for banks and other market participants preparing services under the framework.

Vedyakhin also said Sberbank is prepared to continue sharing its expertise and to take an active role in that process.

Russia’s crypto policy path

Cryptocurrency has been illegal as a means of payment in Russia since 2022, but lawmakers have publicly supported the use of digital assets for international settlements.

Last year, President Vladimir Putin signed a law permitting cryptocurrency mining in Russia. Under that framework, legal entities may mine crypto if they receive approval from the digital ministry. Foreign operations are currently barred from doing business in the country.

In 2023, Russia’s legislature passed a bill legalizing the use of digital currency for international payments.

That measure likely helped the country avoid some international sanctions after the United States and European governments cut Russia off from the SWIFT payments system following its invasion of Ukraine in 2022.

Major Russian banks are preparing to introduce crypto trading services once new domestic regulations take effect. The timing and scope of those services will depend on the implementing rules now under discussion, including how licensed intermediaries, exchanges, clearing functions, and depositories are defined in practice.

Lawmakers have said investors will be required to pass a test before they can begin crypto investing and will face limits on how much they are allowed to buy.

The original report first appeared on Bitcoin Magazine and was written by Mathew Di Salvo.