Law on Cryptocurrency Regulation Registered in the Verkhovna Rada of Ukraine

The Verkhovna Rada has registered draft law No. 10 225−1 on the circulation of virtual assets in Ukraine. This was announced by the Minister of Digital Transformation Mykhailo Fedorov on his Telegram channel.

«The law will help to create favorable conditions for the development of the crypto industry, increase budget revenues and increase the investment attractiveness of Ukraine,» the head of the Ministry of Digital Transformation said.

What does the bill change?

• defines the legal status of virtual assets;
• classifies digital assets and services in the field that are adapted to the European standards for the regulation of cryptoassets (MiSA)
• creates an innovation zone in which it is possible to work without prior authorization for three years;
• adapts the FATF recommendations on financial monitoring of the crypto asset market.

The draft law also provides for simple and clear tax conditions for businesses operating in the field of virtual assets.

«We expect the Parliament to support the draft law and help develop new digital industries.After all, business support is the foundation of Ukraine’s economic growth,» summarized Fedorov.

As a reminder, last year our country ranked third in the rating of cryptocurrency acceptance by the population. According to Tripple A, a research company, the percentage of Ukrainians owning digital assets increased by more than 2% last year. Thus, as of the beginning of 2022, 15.72% of the population, or 6 million people, owned cryptocurrency.

During Russia’s full-scale invasion and military aggression against Ukraine, society has come to appreciate the greatest advantage of cryptocurrency transfers: they can be made at any time and anywhere in the world. In the first three months of the war alone, Ukraine received $ 125 million in cryptocurrency aid, and it continues to flow in.

Regarding the regulation of cryptocurrencies in Ukraine, the ideal formula consists of a balance of the interests of society and the state. According to experts from the National Securities and Stock Market Commission (NSSMC), excessively strict «rules of the game» may negatively affect the development of the virtual asset market and blockchain technologies. On the other hand, broad «self-regulation» of the market can cause significant damage to investors whose assets must be protected.