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Ukraine’s lawmakers pass a law to recognize and regulate crypto

By:
on Sep 9, 2021
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  • The Ministry of Digital Transformation will be in charge of overseeing the enaction of this law.
  • Per Deputy Minister Oleksander Bornyakov, society, businesses, and the state will benefit from crypto.
  • This law allows banks to open accounts for crypto firms that launch in Ukraine.

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The Ukrainian parliament has embraced the Draft Law of On Virtual Assets, allowing foreign and domestic crypto exchanges to operate in the country. A report unveiled this news on September 8, noting this move saw Ukraine recognize cryptocurrencies legally for the first time. Reportedly, the legislation is based on the existing money laundering standards by the Financial Action Task Force (FATF).

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According to the report, the countries lawmakers passed the bill in an almost unanimous vote. The bill, which was first tabled in 2020, is now headed to President’s Volodymyr Zelensky desk. Ukraine’s Ministry of Digital Transformation will be in charge of overseeing the implementation of the new digital asset law. Additionally, the ministry will be responsible for guiding the growth of the crypto sector in the country, while adhering to international standards.

Anastasia Bratko from the Ministry of Digital Transformation noted that this legislation would let companies launch crypto markets in Ukraine. On top of this, it gives banks the go-ahead to open accounts for crypto firms. Bratko further noted that this law would let Ukrainians declare their income in crypto, adding that it guarantees the judicial protection of the rights of crypto HODLers.

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Oleksander Bornyakov, the Deputy Minister of the Ministry of Digital Transformation, said the new legislation would attract foreign crypto exchanges to Ukraine, fostering further development of the country’s crypto space. According to him, society, businesses, and the state stands to get numerous benefits that emanate from the legalization of cryptocurrencies. For instance, Ukraine will get additional revenue from the taxation of crypto firms.

While the country has welcomed crypto with open arms, virtual asset service providers (VASPs) need to meet specific standards. Per the ministry, such companies must have an impeccable business reputation. Additionally, they will have to disclose their ownership structure and identify their ultimate beneficial owners. On top of this, they must adhere to anti-money laundering measures to prevent illicit crypto use.

This news comes as different countries continue warming up to crypto. For instance, El Salvador embraced Bitcoin (BTC/USD) as legal tender, becoming the first country in the world to do so. Cuba also passed a law to recognize and regulate cryptocurrencies to help its citizens circumvent US sanctions. The US is also trying to rein in the crypto space after proposing rules to govern crypto brokers in its infrastructure bill.

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