The Russian bank Expobank says it has issued the nation’s first-ever crypto-backed loan – despite the fact that the country has recently introduced a new law that prohibits the use of tokens as a form of payment.
Per a report from media outlet Kommersant, the loan was secured by using tokens issued by Russian blockchain firm Waves as collateral.
The media outlet quotes Tanzila Yandieva, the head of Expobank’s legal department, as stating that transaction would set “a precedent for both the legal and the banking community.”
The bank says it used a form of escrow, which it says is the best and fastest way to fulfill obligations to creditors when transferring property in the form of deposited digital assets.
Kommersant reports that legal firm EDR assisted in the process, and claims that cryptoassets “fall under the definition of ‘other property,’” and, as such, can be legally viewed as “objects protected by civil rights.”
The bank says it gave the loan to “businessman Mikhail Uspensky,” presumably the same Uspensky who is a co-partner in the Taxology law firm.
Uspensky reportedly told Kommersant that as he was not intending to sell his tokens in the near future, he had instead decided to put them to work, rather than leaving them as “dead weight” in his “pockets.”
Another legal expert also close to the loan deal stated,
“Waves tokens can certainly be used legally in Russia. There are no restrictions on the circulation of non-payment-related tokens in this country.”
Meanwhile, Waves native token (WAVES) has rallied over 100% last week, while Russian lawmaker Anatoly Aksakov stated that “the recognition of digital coins as an official means of payment on a par with the ruble would mean the destruction of the financial system.” Last month, Russia introduced its first crypto law, which will be adopted by January 1, 2021.