Russian Investment Firm Launches Mutual Fund for Crypto Mining

According to Russian business outlet Kommersant, Russian investment management firm Finam Management has unveiled a new fund aimed at financing cryptocurrency mining operations in the country.

The fund will only be available to qualified investors who can invest a minimum of 300.00 rubles (about $4,000).

Russia Joint Fund for Cryptocurrency Mining

Kommersant’s report said the fund hopes to raise 500 million rubles (more than $6.6 million) which will be used to create an LLC that will acquire and lease mining hardware.

The rest of the money invested in the fund will be used to pay for electricity and other operating costs and to service the fund.

The report said that investing in the crypto mining sector has high rewards and risks. He also drew attention to the lack of regulation in the cryptocurrency industry and that the Russian Central Bank is hostile to cryptocurrency.

Russia’s central bank recently warned against legalizing digital currencies, stating that such a move could undermine the country’s financial system. According to Kommersant, the launch of the fund is still subject to approval by Russia’s regulators.

Industry watchers believe that there is a high chance that the fund will be approved and that the central bank will soften its stance towards cryptocurrency mining.

Russia’s central bank previously banned listing digital assets in mutual funds. However, a few mutual funds that invest in companies that deal in blockchain technology have been approved.

Vladislav Kochikov, head of the Finam Group, said that the rules for mutual funds will be sent for approval to a specialized depository after March 1.

Crypto mining is gaining traction in Russia

BitRiver, a mining equipment placement services company, has noted that there has been a massive surge of interest in the company from major banks, investment firms and the UK.

According to Artem Mayorov, director of the Asset Management Department in the UK, mining profitability at current prices for bitcoin equipment and the exchange rate can reach 50% per year, depending on electricity costs.

Market participants have noted the risks associated with purchasing equipment, saying that it is becoming obsolete and losing its effectiveness in relation to new supercomputers, which can significantly affect return on investment.