Moscow-based Russian commercial bank Expobank has created history by providing the region’s first loan which has cryptocurrency tokens as its collateral.
The loan, backed by Waves tokens, was issued to businessman Mikhail Uspensky which made the bank the first lender in the world to issue such a loan.
Cryptocurrencies like waves and bitcoin which are often seen as very volatile are still not wholly legalized in Russia, the Russian President, Vladimir Putin issued a law to allow buying and selling Cryptocurrency.
Yet, the digital currency is not considered as a legal tender. If any other cryptocurrency asset is used as collateral will be considered as “other property.”
Expobank said it believes the use of the crypto tokens as collateral for a loan, defined as “property”, would be allowed under the new rules.
The loan value was not disclosed.
EDR law firm’s managing partner, Alexander Zhuravlyov, directed the bank that the crypto-assets can be used as collateral and can be exchanged for the real currency. Zhuravlyov believes that digital assets can be widely used and applied in real life as well.
Expobank which is currently owned by an economist Igor Kim has been previously controlled by London-based multinational investment bank and financial services company Barclays