Ukraine passes legislation to recognize and regulate crypto

The Ukrainian parliament has adopted legislation regulating interim and domestic crypto exchanges between the country.

On September 8, Ukrainian parliament adopted the bill “On Virtual Assets”, legally recognizing cryptocurrency in the country for the first time. The legislation is based on existing standards developed by the intergovernmental policy-making organization, the Financial Action Task Force on Money Laundering (FATF).

The Ukrainian Ministry of Digital Transformation will be tasked with overseeing the implementation of the new regulation on virtual assets and guiding the growth of the industry, in line with “international standards.

Anastasia Bratko of the Ministry of Digital Transformation said the law allows companies to launch virtual assets in Ukraine and enables banks to “open accounts for crypto companies.

“Ukrainians will also be able to declare their income in virtual assets,” she said, adding that the law “guarantees legal protection of the rights of owners of virtual assets.”

An announcement by the ministry stressed that “the country will receive additional tax revenue to the budget that will be paid by crypto companies,” adding:

“The adopted standards establish rules for service providers related to the circulation of virtual assets and contribute to emptying the market.”

Virtual service providers (VASPs) “must have an impeccable business reputation” and will need to disclose their ownership structure to identify their ultimate beneficial owners. Internal anti-money laundering measures must also be supported by VASPs.

Ukraine’s Deputy Minister of Digital Transformation, Oleksander Bornyakov, emphasized provisions contained in the legislation to attract “foreign exchange to the Ukrainian market”, adding:

“It will become a powerful incentive for further development of the crypto sphere in Ukraine. Banks will open accounts for them and make transactions with a new class of assets. I am sure that society, business and state will benefit from the legalization of the new sector of the economy. “

Related: Ukrainian ministry is considering a digital currency pilot for employee salaries

Last month Mihaail Fedorov, Ukraine’s deputy prime minister and head of the country’s Ministry of Digital Transformation, revealed that his ministry is investigating using a central bank’s digital currency (CBDC) to make salaries in an early pilot of the technology.

Ukrainian President Volodymyr Zelenskyy signed a law authorizing the country’s central bank to issue CBDC in July.