Ukraine has been in the news a lot lately. Well, it has re-emerged, though not in the way you might expect.
Today, the government officially passed legislation legalizing bitcoin and other cryptocurrencies. The bill was originally passed last September, although Ukrainian President Volodymyr Zelansky sent it back to parliament for change. Today, four months later, it has been formally incorporated into law.
What does it mean
“The development of a new industry will allow to attract transparent investments and strengthen the image of our country as a high-tech state,” Ukraine’s deputy prime minister for digital transformation, Mykhailo Fedorov, commented on the bill in September Was.
This is a positive move that seeks to protect digital asset owners, exchanges and other stakeholders in the industry. Particularly noteworthy is the inclusion of the terms digital wallet, private key and virtual asset in Ukrainian law for the first time. While there will always be groups that oppose the introduction of regulation in crypto, overall this is a promising development for the industry and should encourage greater transparency and confidence among those operating in Ukraine as well as reducing fraud. . The hope is that covert mining operations, tax evasion schemes and other “shadow” crypto activities should now subside, while innovation will increase and foreign investment flows into the country.
Political upheaval
Unfortunately, there is an elephant in the room here. Given the ongoing issues with a certain Mr Putin, even hardcore crypto fans are unlikely to queue to book one-way tickets to Ukraine. The reality is that you can list all Ukrainian crypto positives you want – such as lower taxes, a streamlined legal framework, improved technical infrastructure and an abundance of engineers – but as long as there are 150,000 Russian troops stationed on the border, Ukraine’s hope. To become the digital asset hub of Eastern Europe is unlikely to be achieved any time soon.
However, political concerns aside, it sees Ukraine as steaming ahead of European countries with a legal framework on crypto. While South America has been particularly welcoming in its approach to crypto legalization, Europe has not been as warm to date. The European Union has begun to put a tighter leash on crypto transfers, attempting to make them more traceable. While individual states have legalized it – perhaps most notable in Germany last year a law allowing German spicialfonds Ukraine still had high hopes of leading the virtual charge on the continent when the bill was originally put forward – to allocate up to 20% of its assets to crypto.
Of course, the last interesting quirk in this story is quite the opposite in comparison to Russia. Putin has been notoriously anti-crypto, insisting on banning the industry outright and instead focusing on the development of a central bank digital currency.
It is another thing for them to disagree with Ukraine.