Ukraine passes legislation to recognize and regulate cryptocurrencies

Ukraine’s parliament has passed legislation to regulate foreign and domestic cryptocurrency exchanges operating from within the country.
Ukraine’s parliament on Wednesday passed a draft law “On Virtual Assets,” legally recognizing cryptocurrencies for the first time. The legislation is based on existing standards set by the Financial Action Task Force (FATF), an intergovernmental policymaking body on money laundering.
Ukraine’s Ministry of Digital Transformation will be responsible for overseeing the implementation of new digital asset regulations and guiding the industry’s development in terms of compliance with international standards.
Anastasia Bratko of the Ministry of Digital Transformation said the law allows companies to launch digital asset markets in Ukraine and enables banks to “open accounts for cryptocurrency companies.”
“Ukrainians will also be able to declare their income from virtual assets,” she said, adding that the law “guarantees judicial protection of the rights of virtual asset owners.”
An announcement from the ministry stressed that “the state will receive additional budgetary taxes, which will be paid by cryptocurrency companies,” adding:
“The adopted regulations set rules for service providers related to the circulation of virtual assets and contribute to the demystification of the market.”
Virtual asset service providers (VASPs) “must have impeccable business reputation” and will be required to disclose their ownership structure to identify their ultimate beneficial owners. VASPs must also maintain internal anti-money laundering measures.
Oleksandr Bornyakov, Ukraine’s deputy minister for digital transformation, highlighted the provisions included in the legislation to attract “forex to the Ukrainian market,” adding:
“This will become a strong incentive for further development of the crypto sector in Ukraine. Banks will open accounts for them and trade with the new asset class. I am sure that society, businesses and the country will benefit from the legalization of a new economic sector.”
Last month, Ukraine’s deputy prime minister and head of the country’s digital transformation ministry, Mykhailo Fedorov, revealed his ministry was exploring the use of the central bank’s digital currency for salary payments as an early pilot for the technology.
Ukraine’s president signed a law in July authorizing the country’s central bank to issue a CBDC. (Cointelegraph)