The Law of Ukraine «On Virtual Assets» will be finalized in accordance with the provisions of the EU regulator

The Law of Ukraine «On Virtual Assets», which concerns the cryptocurrency market, will be finalized taking into account the provisions of the European draft law on MiCA regulation. This was reported by representatives of the Ministry of Digital Transformation. According to the ministry, after Ukraine became a candidate for EU membership, local legislation needs to be adapted to European standards. In addition to the Ministry of Digital Transformation, the National Securities and Stock Market Commission (NSSMC), the National Bank, and major market players are working on relevant amendments to the law.

«The revision is likely to concern the adopted classification of VAs (virtual assets — ed.). The terms of theinitial proposals from the draft law on what should be considered virtual assets and much more will also be reviewed,» the ministry said. The NSSMC added that updating the law is mandatory for the further development of cryptocurrency taxation rules, which will be prepared as a separate bill. The new version of the document will be published at the end of 2022.

The Law of Ukraine «On Virtual Assets» adopted in September 2021 will not come into force until the Tax Code of Ukraine is amended. It is currently unknown when this will happen. The martial law in force in Ukraine, the return of the Covid-19 pandemic, or other pressing issues may slow down the process.

The draft MiCA regulation will allow Europe to become the first part of the world to establish clear rules for digital assets. Interestingly, the MiCA rules will cover only cryptocurrencies, while the issue of non-fungible tokens and stablecoins remains open. However, it was reported earlier that the European Commission is ready to add rules to the MiCA that will regulate the circulation of non-fungible tokens and consider the environmental impact of cryptocurrencies based on the PoW (Proof-of-work) algorithm.

Last week, Changpeng Zhao, the head of the Binance cryptocurrency exchange, suggested that the EU’s legislation on cryptoasset markets (MiCA) is likely to be adopted globally as a standard for cryptocurrency regulatory policy. However, the head of Binance expressed some concerns about limiting the issuance of stablecoins pegged to the US dollar. Changpeng Zhao believes that this could lead to their possible ban in the EU.