The market for digital financial assets may show multiple growth

The Russian market of digital financial assets (DFAs) next year may show a multiple increase in the number and volume of placements. Market participants consider short-term loans, b2b financing and factoring to be the most promising. However, for its development it is necessary to align tax conditions with the securities market, as well as simplify customer identification. In addition, the market still lacks liquidity.

In 2024, information system operators (ISOs, which have the right to issue DFAs) expect a manifold expansion of the market. This is evidenced by an OIC survey conducted by Expert RA (Kommersant reviewed it). Thus, the number of DFA issues can reach 300, and the total volume – 125 billion rubles. According to Kommersant’s assessment based on published information, since the beginning of the year, OICs have announced the placement of almost 140 issues of DFA with a total face value of more than 42 billion rubles. However, some of the issues are in the placement stage, and three issues (worth 0.8 billion rubles) were declared invalid.

For the nine months of 2023, according to Expert RA, 90% of issued DFAs are represented by simple monetary claims. According to OIC expectations, this focus will continue into 2024.

Representatives of most platforms note short-term loans, b2b financing and factoring as the most promising digital financial services. Simple monetary requirements are clearer to the market, which is why they are used in the vast majority of cases, noted Deputy General Director of Masterchain Maxim Tishchenko. As Anna Shapovalova, head of the Alfa Bank DFA platform, notes, “some of the traditional markets are migrating to a new format, cannibalizing the current one,” while the DFA seems to be a convenient mechanism “for processing intercorporate borrowings.” However, here IPOs are faced with a conservative investment policy of large corporate clients, “whose risk policy has restrictions on placing free liquidity in the risks of other companies.” Implementing other DFA functionality provided for by the relevant law, for example, as part of “tying it in” to income from a product or product, is much more difficult due to regulatory barriers, added Andrey Tugarin, founder of GMT Legal.

In addition, the DFA segment is not sufficiently regulated. To develop the market, according to Ekaterina Frolovicheva, CEO of Atomize, it is first of all necessary to align tax conditions with the securities market so that DFAs are taken into account as part of the overall tax base. According to Oleg Ushakov, CEO of Sagrada Legal, one of the most important issues is simplification of the identification procedure; in particular, for investment platforms it is possible to use the ESIA, but this function is not applicable to DFA. In addition, according to him, according to the law on CFA, the decision on the issue must be signed by the sole executive body (for example, the general director) without the possibility of transferring powers by proxy, which is extremely inconvenient for a large corporation.

Traditionally, market participants point out that the development of the DFA market is hampered by a lack of liquidity.

According to Roman Nekrasov, co-founder of the ENCRY Foundation, “without a retail investor there is no liquidity, that is, the ability to quickly enter and quickly exit an asset by selling it. But there will be no retail investor without the cooperation of OIS with brokers, and brokers have little interest in DFA.” Anna Shapovalova explains that most liquidity is concentrated with institutional investors, some of whom (for example, management or insurance companies) have “regulatory restrictions on the purchase of DFAs.” The base of individual investors is located with brokers, “who are not yet connected to the OIS as partners.”

The majority of OIS respondents expect an increase in the number of DFA exchange operators (up to five organizations; currently only the Moscow Exchange has this status), which will contribute to the growth of liquidity. Moreover, transactions are already being carried out involving clients not only of DFA exchange operators, but also of placement organizers – by analogy with the placement of bonds (see “Kommersant” dated October 11).

Ksenia Kulikova