Citizens have cooled to cold wallets – Newspaper Kommersant No. 168 (7369) of 09/13/2022
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The interest of Russians in hardware (also called cold, that is, on a physical medium) crypto-wallets, which has skyrocketed against the backdrop of the outbreak of hostilities in Ukraine and the active relocation of citizens, is declining. The sales volume of devices on the largest marketplaces has almost halved, some market participants are talking about an oversupply. Now the sale is stimulated mainly by the price that has decreased several times. Experts note that the use of such crypto wallets makes sense in the first place when it comes to storing large amounts, waiting for demand to recover as the cryptocurrency market improves.
Kommersant’s interlocutors on the market told about overstock at retailers of hardware crypto wallets – there are more goods in stock than they can sell. This situation, according to a Kommersant source, arose after the explosive demand for these devices in the spring, when the Bank of Russia introduced restrictions on currency transfers.
According to the Moneyplace marketplace analytics service, sales on Ozon and Wildberries in May reached a record high of 16.5 million rubles. In August, the figure fell by half, dropping below 8 million rubles.
An Ozon spokesperson said that sales of hardware crypto wallets in units increased more than five times in the first half of 2022 compared to last year. The peak of demand, according to him, fell on April, in May and June the demand stabilized, but significantly exceeded the indicators of the beginning of the year.
M.Video-Eldorado noted that the peak of sales was in March with a sharp, at times, growth relative to the previous year, in the second and third quarters, high demand still remains. Citilink noted that they launched Tangem crypto wallets at the end of June 2022 – the peak of sales occurred in July, but at present the company does not observe a significant decrease in interest in these products. Yandex.Market did not respond to Kommersant’s request.
Experts believe that it makes sense to buy cold crypto wallets only for large amounts.
According to Roman Nekrasov, co-founder of the ENCRY Foundation, even for $5,000-15,000, “there’s no point in bothering with a purchase.” According to Mr. Nekrasov, for most crypto users, including newcomers who came to the crypto world after February 24, “it is enough to have a p2p account from Binance, buy the required amount of USDT stablecoins there, and then exchange them back for fiat somewhere in Georgia “.
Most manufacturers of crypto wallets did not respond to Kommersant’s request.
Sergey Kharinov, Managing Partner of Tangem AG, confirmed that after the hype in March-April, a gradual decline in demand for crypto wallets in Russia began, which continued until the end of June. According to Roman Nekrasov, this happened due to the fact that the Central Bank systematically loosened restrictions on cross-border currency transfers. In addition, “those who wanted to transfer assets abroad, most likely, have already done so,” the expert believes. At the same time, M.Video-Eldorado notes that such accessories are often bought as a gift, which “may have a positive effect on demand dynamics in November-December.”
At the same time, the volume of trading was affected by the decrease in the cost of crypto wallets, both against the backdrop of reduced demand and against the background of the stabilization of the dollar. According to Moneyplace estimates, from April to September, the average prices for Safepal products fell three times, Ledger and Trezor – twice, Tangem – a quarter. Currently, average prices are 3-8 thousand rubles, while in April they reached 19 thousand rubles. The press service of Wildberries confirmed that prices for individual crypto wallets have dropped to half the level.
Alexey MoiseevDeputy Minister of Finance of the Russian Federation, at the Eastern Economic Forum, September 6, 2022:
“We now have nothing preventing people from being able to pay in cryptocurrency for cross-border payments.”
An important factor that influenced the drop in demand in Russian stores was the sale of “broken devices, as a result of which the owners lost quite significant funds,” said Sergey Mendeleev, Executive Director of InDeFi Smart Bank.
There are no restrictions on the use of crypto wallets in Russian legislation, since the activity with cryptocurrency itself has not yet been legalized, Pavel Ganin, a partner at atlegal law firm, noted. However, if the owners of crypto wallets are given the opportunity to pay for goods and services, this will undoubtedly increase demand for this product, he believes. Despite the growth of bitcoin quotes in recent days above $22 thousand, they still remain near the minimum since December 2020. Ethereum quotes remain about $1.7 thousand, while at the beginning of the year they exceeded $3.5 thousand (see “Kommersant” dated September 12). In addition, Aaron Chomsky, head of the investment department at ICB Fund, believes that a recovery in demand for hardware wallets can be expected as the cryptocurrency market improves, which can give rise to a new wave of investors in digital assets.
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