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The Ukraine parliament, the Verkhovna Rada, has finally passed legislation dictating the rules for crypto-related activities in the country. The parliament adopted the “On Virtual Assets” law on its second and final reading. Lawmakers voted overwhelmingly for the law, with 276 out of 376 present MPs voting yes to the motion, while only six voted against it.
The new law will take effect immediately after lawmakers approve amendments to the Ukrainian tax code to accommodate the taxation of cryptocurrency transactions.
Provisions of the crypto law recognize digital assets as secured or unsecured intangible goods. However, the government does not recognize cryptocurrency as a legal means of payment and prohibits its use in payments of goods and services.
Also, the newly-passed law introduces the term “financial virtual assets” for the issuance of entities registered in the country. Assets backed by currencies will get regulated by the National Bank of Ukraine (NBU). Security or derivatives-based assets will get regulated by the National Securities and Stock Market Commission (NSSMC).
Per the law, the crypto community in the country can independently determine the value of digital assets, open bank accounts to facilitate transactions, and pursue judicial protection for associates’ rights. Also, Service providers are mandated to comply with the existing anti-money laundering (AML) regulations and know your customer (KYC) requirements.
Ukraine is Crypto-Friendly: Executive Power Representatives
According to representatives of the executive power, the Ukrainian authorities maintain a friendly stance on the country’s growing crypto industry. In a recent visit to the US, Ukraine President Volodymyr Zelensky emphasized the importance of fostering a legal digital assets market, noting that it is a “development vector” of the European country’s digital economy.
The Minister of Digital Transformation Mykhailo Fedorov noted that the administration seeks to model the country as an attractive jurisdiction for crypto companies.
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