Russian Brokerage Finam to Launch Investment Products Tied to BlackRock's Bitcoin ETF

Russian retail brokerage Finam is preparing to launch investment products linked to BlackRock's iShares Bitcoin Trust ETF (IBIT), providing qualified investors in Russia with exposure to spot Bitcoin ETFs for the first time. Starting on Feb. 17, Finam will offer structured notes based on BlackRock's IBIT, according to Anton Dorodnev, the company's head of innovative products. This new investment product is specifically aimed at qualified investors in Russia and will have a six-month maturity period, making it one of the first IBIT-based structured notes. Previously, Finam allowed Russian clients to invest in BlackRock's IBIT ETF through its platform, indicating a move towards broader crypto-linked investment products in the country. The upcoming IBIT bond from Finam will be in Russian rubles, with the yield calculated based on the dollar equivalent using the Bank of Russia's exchange rate. Investors can receive up to 20% in dollar yields if the price of the Bitcoin ETF at maturity exceeds the launch price by at least one basis point. The minimum investment amount is 200,000 rubles, with a 1% brokerage commission in rubles. Additionally, Finam plans to introduce similar products tied to Ether (ETH) spot ETFs, as mentioned by Dorodnev. The IBIT bond from Finam presents a complex legal case in Russia, with differing opinions on the legality of such products. While some consultants see no legal restrictions, others highlight risks in offering structured notes based on cryptocurrency ETFs. Russia's crypto law does not classify crypto assets as securities, but structured bonds are considered securities, creating uncertainty around the legal basis for such products. Despite this, Russia has shown openness to Bitcoin, with the Finance Minister stating that local legislation allows foreign trade using BTC and other digital assets by December 2024.