Trading in digital assets backed by precious metals has begun in Russia with the launch of a token for palladium. This rare metal, which is used in jewelry and has several high-tech uses, is not a publicly available asset in the Russian Federation.
Atomyze and Rosbank issue digital token for palladium
The Russian division of Atomyze, a platform specializing in the tokenization of commodities, and Rosbank will begin trading digital financial assets (DFA) based on precious metals. The first phase is a token issue for palladium, with the holder entitled to a monetary claim equivalent to the market value of the metal, Atomyze said in a press release.
Palladium is not an official asset on the Russian market, Prime Business News Agency reported on the deal. At the same time, it is seen as a promising investment. Palladium is used in jewelry as a substitute for platinum, and demand for platinoids is increasing worldwide. It is also an industrial material involved in high-tech manufacturing.
Atomyze Russia is registered with the Central Bank of Russia as an operator of the DFA platform and is authorized to offer blockchain-based financial products. Tokenization can create new opportunities and provide an alternative tool for both businesses and private investors, the report elaborates.
Digital financial assets is probably the only legal term currently applicable to cryptocurrencies in Russia until a dedicated law “on digital currencies” is adopted this fall. Unlike decentralized coins, however, DFA primarily refers to digital assets that have an entity responsible for their issuance and distribution that guarantees the rights provided by the asset. The Law on Digital Financial Assets actually defines various tokens as “digital rights.”
Billionaire Vladimir Potanin, one of the people behind Atomyze, commented that the issuance of digital rights allowing investment in raw materials such as metals is a new precedent in Russia. He further stated that this is the beginning of a new era in the Russian economy, the “age of tokenization.” Potanin has previously expressed hope that tokens, along with digital rubles, will replace “untrusted” crypto assets. He also believes that DFA will replace foreign currency deposits.
Ekaterina Frolovicheva, CEO of Atomys Russia, added that “this first step is just the beginning of a great story, involving a new vision of traditional products and the creation of radically new products for issuers and investors.”
Russia has not yet implemented comprehensive regulation, as the current geopolitical situation has prolonged the debate about the future of cryptocurrencies. While most government agencies oppose their use as a domestic payment method, a proposal to allow small crypto payments in international trade in the context of sanctions is gaining support. A law recently signed by President Vladimir Putin prohibits DFA payments within Russia.
Image credits: Shutterstock, Pixabay, Wiki Commons