The Ukrainian Parliament has passed a legislation that legalizes cryptocurrencies. The country hopes its new digital asset regulations will attract foreign crypto exchanges.
The Ukrainian Parliament passed the draft law “On Virtual Assets” on September 8, making cryptocurrencies legal for the first time in the country.
The legislation is based on existing guidelines issued by the Financial Action Task Force on Money Laundering, an intergovernmental policy-making group (FATF).
The Ministry of Digital Transformation of Ukraine will be in charge of overseeing the new virtual asset regulation’s implementation and directing the industry’s growth in accordance with “international norms.”
The law, according to Anastasia Bratko of the Ministry of Digital Transformation, authorizes businesses to start virtual asset exchanges in Ukraine and allows banks to “register accounts for crypto enterprises.”
“Ukrainians will be entitled to declare their income from virtual assets as well,” she added, adding that the law “ensures legal protection of virtual asset owners’ rights.”
The ministry stated in a statement that “the country will receive additional tax revenues to the budget, which will be paid by crypto companies,” and that “the country will receive additional tax revenues to the budget, which will be paid by crypto companies.”
“The adopted norms establish rules for service providers related to the circulation of virtual assets and contribute to the market’s de-shadowing.”
Virtual asset service providers (VASPs) will be obliged to disclose their ownership structure in order to identify their ultimate beneficial owners, and they will be expected to maintain an “impeccable corporate reputation.” VASPs must also maintain internal anti-money laundering measures.
Oleksander Bornyakov, Ukraine’s Deputy Minister of Digital Transformation, emphasized aspects in the legislation aimed at attracting “foreign exchange to the Ukrainian market,” adding:
“It will become a powerful incentive for the further development of the crypto-sphere in Ukraine. Banks will open accounts for them and conduct transactions with a new class of assets. I am sure that society, business and the state will benefit from the legalization of the new sector of the economy.”
Ukraine’s Deputy Prime Minister and Minister of Digital Transformation, Mikhail Fedorov, stated last month that his ministry was testing the use of a central bank digital currency (CBDC) to process wage payments in an early pilot of the technology.
In July, Ukrainian President Volodymyr Zelenskyy signed legislation allowing the central bank to issue a CBDC.
